It enables you to use Google's services without having to login, so you can keep connected and share things among those services.
Or course, they collect your data.
Though, on the other hand, we hear about all sorts of breaches that result in a loss of personal data. Google hasn't really had that happen - yet.
They use this data to tailor ads to you. They also use this data in aggregate format to understand the behavior of people, such as those they consider your peers/like-minded persons.
I use Google and Gmail. I use their online storage for some encrypted file backups. I'm okay with 'em tracking my behavior. They're easy enough to avoid if I have any complaints or want some privacy. I absolutely love their tailored search results. They're great - and I've done plenty of A/B testing to conclude that I am happy with 'em.
Just, you know, you're being tracked. Meh... If I want to hide, I hide. I mostly don't care and I'm happy with what I get in return. I consider it an exchange worth making. It's up to you to decide your viewpoint on the matter.