Content types are a useful way to group similar content, with similar characteristics. It means people can talk about sets of content (e.g. events) and it’s also a way to set up a common template across a type. For example, events will always have a time, date and location and so the event content form contains these fields, whereas other types of content won’t include this information.
Content types are also used when setting display rules for the site, such as showing the three most recent blogs on the homepage.