I suspect marketing aimed at appealing to an angler's vanity is part of it, but I was surprised at how much better the more expensive reel I purchased performed. It was noticeably smoother as I stripped off line and obviously better constructed. In a couple of years of use, I have, for instance, never encountered line pinching. The additional smoothness and dependable performance make it a pleasure to fish with. Another characteristic that sets reels apart is drag quality.
Drags prevent overspooling and slow the runs of bigger fish.
It's largely intended to prevent overspooling, which occurs when the spool spins too quickly or continues to spin once your line stops moving through the guides. Additional drag is achieved by applying pressure to the spinning spool with the palm of your hand. Most of today's reels have one spool rim exposed, which enables you to easily palm the reel. If the rim is not exposed, you can exert drag via finger pressure applied to the spool, but it's more awkward. When angling for big freshwater salmon, steelhead, pike, and muskie, disc drags can also be helpful, but they're unnecessary for most non-migratory trout.