Grandpa Munster gave Eddie a magic potion that inadvertently caused him to grow a beard. While eating dinner, the Munsters find out that Eddie's beard dissolves in water. Herman takes the opportunity to instill a valuable lesson in Eddie: it doesn't matter what he looks like, but what really matters is "the size of [his] heart, and the strength of [his] character." This clip suggests that we should not judge others by how they look but by their inner qualities and how they treat others.
Eddy is normally treated with contempt by the other cul-de-sac kids. When he disguises as an alter-ego named Carl, all of the kids treat him kindly. Eddy is confused as to why they're being so nice, and Double D explains the concept of acceptance. He states that Carl has a clean slate, as he hasn't done anything to ruin his reputation, unlike Eddy.