The Ironclad is one of the first "modern" warships which utilises metal as a form of armour cladding, making her extremely resistant to the round shot of past eras, and giving it some added protection from the explosive shells being introduced into warfare, and also carries a newer genus of naval gunnery, thus guaranteeing better range and killing power for her weapons. Use the Ironclad to wipe out enemy Steam Corvettes, Steam Frigates and Cruisers, but watch out for Submarines or Torpedo Boats, especially if you are playing against Peru, since Peru can get out the Toro-class submarine fairly quickly.
However, obtaining these new warships isn't always so easy. For one, you must first obtain the Military-Industrial Complex in order to construct them, by finishing the research of Bessemer Process. The next step then will be that you need to research another upgrade, Steelworks, in order to unlock the ability to upgrade all Heavy Ships to the Ironclad. This means that JUST to obtain the Ironclad (as well as unlock the more devastationg Destroyer and Dreadnought-class vessels) you need to jump through lots of technological and resource hoops. For one, the Military-Industrial Complex is not very cheap to build, meaning that you will have problems if you do not have the resources on hand to complete whatever research you need to do (for instance, you need Oil to actually build the Military-Industrial Complex).
With the onset of the Industrial Age, Western civilisation began to experience a degree of technological and economic mastery hitherto unknown for centuries. One of the areas impacted by this was the production of iron, which made it cheaper and easier to work with. The more reliable and more economical supply of iron thus meant that a new chapter in naval history was about to be written: the age of metal warships.
The mastery of steam power and the new navies of 19th century Europe (as well as many conflicts throughout the period) soon meant that ironclads would progress from being ad hoc improvised vessels (such as the Japanese atakebune, or the conversion of ships of the line reclad in iron and refitted with steam propulsion) but were purposefully built vessels meant to be constructed en masse on an industrial scale.