An intense hickey combined with a finger (or toe/thumb) into the anal cavity. Usually done in retaliation for a previous act such as a titty twister or hurts donut. The Icelandic roots of the word are because it burns so bad your ass needs all the ice in Iceland to soothe itself.
T: what the fuck? You just gave me a wet willy?
J: hahahaha I’m so funny
T: we’ll see who’s laughing after I give you a gjofferknoffer
J: damn, I learned my lesson. I’m sorry.