What is the difference between an ETF's net asset value and its market price?

The Net Asset Value is simply the total value of all the fund holdings.

As ETFs are traded on an exchange, they are subject to the normal demand/supply and so market price could be different.

HOWEVER - as part of the market structure, Authorised Participants (generally large financial institutions) are allowed to create/redeem shares of the ETF by exchanging baskets of underlying shares with the manager. Through the operation of this process, any price gaps between NAV / share price would be arbitraged away (note - this is for market structure participants not investors, we are talking about millions of dollars in shares for each creation unit)

Eg for the S&P500 ETFs the gap between NAV / market price is usually 0.01 (lowest possible tick size in US market)

Adding on to Zann's point, the net asset value can be used to compare the performance of different funds. Investors should not pay more than the net asset value of shares. If the market value of an ETF falls, and you can therefore buy shares at a discount to NAV, it can often give you a good opportunity to get a bargain.