A thumbnail on a vid is the image that displays until the vid is hovered over or clicked on.
To create your thumbnail, click <Launch> once a vid has fully uploaded and processed and then click <Edit Thumbnail> and a drop-down menu will appear with two options:Select from vid
This option lets you use a still from your vid as the thumbnail. The vid needs to be played and paused at the desired frame. Click <Select from vid> once you've found the right frame to apply your thumbnail.
This is the option to use a custom image as your thumbnail. Click <Upload> and the option to select the image file will appear. After selecting the desired image, a preview window will open which will require you to select the area you wish to be displayed (if the image is too big, cropping may be required).