Industrial design (ID) is the professional service of creating and developing concepts and specifications that optimize the function, value and appearance of products and systems for the mutual benefit of both user and manufacturer. -IDSA
No, thats a bit too poindexter for most people. It gets into 'systems' .. a tricky concept for a one-sentence explanation.
If the mission is to explain to someone what ID is how about you start with something they already maybe understand and build on that?
So, say... "You know what a graphic designer does?" (They probably don't fully understand that either, but they have heard of it before.)
"Ok, a graphic designer designs things that will be printed on paper, or displayed on a computer screen, flat things like that.... Industrial designers work on three-dimensional things (and sometimes interfaces and processes/systems) like .. virtually everything you buy and use every day. Appliances, tools, cars, fixtures, toys and all that stuff ... "
and you can go on from there to talk about how many things are made without industrial designers, either vernacular (another new vocabulary word) products that have evolved over time or products designed by the experience of the maker and engineers.
You can go on to explain systems, systems science, materials science, ergonomics, cost-optimization, styling, branding and marketing, design management and all that if you understand it well enough.