I only use shapeshift if I know I need an altcoin fast. It rarely comes up, but it's handy when it does. The fees are high so it's not something I would do regularly (like if you're planning on day trading altcoins) but if you want to trade 100 obscure altcoins for 75 of some other obscure altcoin it is the place to go. The other choice would be to go to a large exchange, place a bid to sell your coins for bitcoins, then trade those bitcoins for the other altcoin you needed. You're mainly just paying a convenience fee.
You're missing two huge benefits: identity, or lack of it, and not keeping your money locked in an exchange. Every exchange requires some form of identity, especially if you will be trading big amounts. Shapeshift is totally anonymous and instant. Also the fact that they immediately send funds back to your own wallet, instead of locking it up, is a big benefit. Sure you could manually do that on an exchange, but it is less convenient enough that people don't do it. I moved to shapeshift for all my trading, including big amounts, it's worth the small additional cost (less than 0.5% off polo in general).
