Hi John,
A reference track is a (normally) commercially produced and mastered song or musical piece (or even sample) that sounds the way you want your production to sound. Reference tracks can contain anything from the sound of a well-mixed kick and bass through to effects, drum sounds, vocals ... anything you want including mastered tracks. There are a number of well-respected tracks mentioned on the web, books, magazines etc. that might be cited by experts, but you should create a reference library of your own to suit your musical tastes or client requirements.
The process is just to place a sample of the reference in a separate track aligned where you want your processing to take place and A/B by using mute or solo. Of course, you should also try to find e.g. interviews with engineers or producers who can describe the process too.
You are listening for any element of the reference you want to apply to your own track, such as eq, compression, fx, or balance with other parts. The art to this is learning to listen both in a focused way to these single elements and also to combinations and right up to the whole mix. Also take into account the original performance, players gear, mics, room etc. and note that commercial music is already mastered so try to take this into account too when mixing...!
Build a reference library and store it as samples you can drag and drop into tracks - don't be surprised at how many you end up with!
Hope that helps. Happy mixing!
G