According to one commenter there are some semi-valid reasons –
The companies that provide these services claim a lot, but it is definitely going to provide the protection from the following things:
Tampering (or at least make it clearly evident)
Weather (rain, snow, etc)
The companies go on to suggest that you can also prevent scratches, wear and tear, and other such things. I find it hard to believe a thin layer of plastic could do that, but it probably does provide some degree of protection from those too.
The most convincing however, is the protection from Weather. The tarmac where the plane is loaded isn't protected from these things. If I have fabric luggage, I can use these wrapping services to prevent rain, mud, or frozen winter shit from getting into or on my luggage. Possibly damaging it permanently. – http://travel.stackexchange.com/a/3233
Have you seen this? Have you paid for this service?
Why would you wrap your luggage in plastic?
At many airports you can wrap your luggage with sheets of sticky plastic. Why on earth would you do that? I only see disadvantages. I can imagine the mess when customs ask you to open your luggage. So…
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