The two lines that do all the work are basically the <%@ Register %>tag that references the assembly that contains the control, and the <Web:ContactsDropDownList /> tag that tells ASP.NET to render the control you just created (remember that the prefix defined in the Register tag must match the prefix used to declare your control!).
And of course, since the ContactsDropDownList handles its own databinding, there is no need to worry about obtaining the Contacts data in the code behind page.