Tag management is an essential component of any tracking deployment. The most common reasons it’s used include:

Agility & Control
Remarketing
Deployment Cost
Site Speed
Privacy

Source: econsultancy.com/reports/tag-management-buyers-guide

Additionally, it standardises data capture, by using a common set of object names across multiple websites. This significantly simplifies installations as generic configuration files can be used (click below to see my 3 cheat sheets).

#digitalData JSON object names cheat sheet

GTM DataLayer cheat sheet (Enhanced Ecommerce version)

GTM DataLayer cheat sheet (App version)