The reasons for using InstaShop will vary from shop owner to shop owner.
If you look at this example you can see that the client is using InstaShop to show pictures of their customers using their products. InstaShop allows them to show a gallery of customer generated content, within their shop, that includes links to their products.
This shop owner shows pictures they have taken and posted to their Instagram gallery. This allows them to show a variety of their products, outside of a the more rigid list of products in the main section of their shop.
This customer has embedded InstaShop on their home page as a slider and a dedicated page as a grid, conveying both a lifestyle and dedicated product pictures.
Other customers use InstaShop to simply display Instagram pictures. A huge benefit of this approach is they stop sending potential customers away from their store.
The choice is ultimately dependant on the range of products you sell, how you wish to present your shop to your customers and your use of Instagram.