The straw poll is basically a big all day political party with entertainment, food, and speeches by the candidates. It has become a huge media event over the last few elections cycles. All who attend vote for their favorite candidate in a straw poll (non binding vote). It is simply an early test of the candidates strength. A good showing there can amount to millions in free advertising and make a serious contender out of a candidate that is relatively unknown. The tickets to the event are usually paid for by the campaign if you go in support of their candidate.  The effect on the August 11 straw poll is that it can give a candidate national media coverage and name recognition, i.e.,  momentum. 

The caucuses are different from the Iowa Staw Poll and Iowa holds the first one in the nation. Some states have caucuses and others have primary elections. A primary is simply an election day when people go to their polling place and vote as in any other election. The difference is that voters have to declare a party and vote for their favorite candidate in that party. Primaries and caucuses are all about selecting the nominee for the party. 

In a caucus, there are precinct meetings (each county is broken down into voting precincts) where voters come and do a three primary things.

1) they discuss issues and vote on what issues (platform planks) they would like to see their party have, i.e., a pro-life position.

2) they also elect delegates on the precinct level who will go to represent the precinct on the county level where they basically do the same things over again except they elect delegates from the county to go to the district convention. They in turn do the same thing and send delegates to the State Convention, and the state convention then sends delegates and platform planks to the National Convention. The important thing about the Caucus is to get conservative people to attend and vote on conservative values for the platform planks and also get conservative people to serve as delegates through all the levels up to the national convention.

3) the third thing that happens at the Caucus is another straw poll vote that is reported by each precinct, to county, to state and they are all tallied up and an Iowa Caucus winner is declared. It is non binding, but the media is all over it and if a candidate can get his people to go out to the caucus and vote for him, then it is again a very good showing of strength and can be worth a lot of political capital.