A formal playoff is widely opposed by university presidents. So we do the best that we can. With most bowls comes a week of basking in a warm-weather setting. National TV exposure. Additional practice time that non-bowl teams don't get, and with that a head start on the following season.
Most schools see money spent on bowls as an investment.
I'm not saying it's right. But it's a big plus. Enrollment goes up. Giving to the university goes up all over. It certainly helps us in recruiting.