Such as that clouds have shapes, or Mars has canals, or that two dots and a line inside a circle is a face, or that a feature on Mars consisting of two dots and a line on a circular mesa is a face, or that there is hidden meaning in music played backwards, or that a scorch mark on toast is $religious_figure_of_choice, or that et-freaking-cetera. Humans are pattern-matching machines -- we search for and find meaning in noises emitted by other humans, we recognize identities by faces, we evaluate threat or opportunity or tribal kinship in small changes of expression, we turn little squiggles of light and dark into what you are reading as words. Pareidolia is the flip side, where our brains go a little too far and matches patterns that aren't there. It's the basis of things as harmless as optical illusions and as corrosive as conspiracy theories. It's part of being human. But as a word, it seems to have been coined less than 20 years ago, from Greek roots para-, beside here used in the sense of being wrong + eidōlon (from which we also get idol), diminitive of eidos, image/form.
We lay on the hillside and engaged in the idle pareidolia of cloud-watching.