The hippocampus is part of the limbic system and is involved in consolidation of memories as well as spatial reasoning.

The mnemonic simply requires breaking "hippocampus" into "hippo" and "campus". 

Hippos are big and somewhat dumb-looking animals,

so perhaps they should attend a university campus and try to consolidate some new memories.  (Additionally, hippos are big and heavy and compress the material under their feet, somewhat like the process of consolidation.) 

But if you were to bring a hippo to a campus, it would involve some careful spatial reasoning to make sure it doesn't step on people or get stuck in doorways and staircases.