The output object specifies where the resulting file, after processing and bundling, is stored: 

const srcPath = path.join(__dirname, 'src'),
  distPath = path.join(__dirname, '../force-app/main/default/staticresources'),
  extractCSS = new ExtractTextPlugin('styles.resource');

............

output: {
    // output file into SFDX staticresources location
    path: distPath,
    filename: 'app.resource',
    libraryTarget: 'window',
    library: 'StaticResource'
}

The preceding config means the output bundle will be stored in the SFDX static resource folder and the name of the file will be app.resource. When a module is generated, the entire source code is stored in the window object with a property named "StaticResource", as shown in the following code snippet:

window["StaticResource"] =
/******/ (function(modules) { // webpackBootstrap
......
/***/ })