I rather enjoyed Hanna Rosin's thoughts on this question during last week's Slate Gabfest:
Look, most Americans pay no attention to politics, and then comes the convention, and then it's like a pageantry, and that's as interesting as politics is going to get. I feel it's slightly bogus when political reporters say things like, "Oh, no policy happens." Like you were going to write about policy if it did happen? All you do is write about image and message for the entire year and then the convention comes and you complain because it's only about image and message.I agree with Rosin: the pageantry matters! This is the part of the election cycle where normal Americans (read: not political junkies) begin to pay attention to the candidates, the parties, and the issues, and the conventions are a big part of how that happens.
Along these lines, conventions serve as an opportunity for a party to present its candidates and its stances to the general public. Those who only learn about the current election from advertisements are getting a somewhat abbreviated and decidedly negative perspective; the conventions are the parties' chance to define themselves and lay out their arguments for why they should be in charge. We also get to see some of the up-and-coming candidates in a party; the next two weeks will give most Americans their first opportunity to hear from some of the likely 2016 presidential candidates.
Conventions also provide a rare opportunity for gathering something close to the entire party (depending on how one defines that) under one roof. That is, a national convention includes delegates, donors, activists, interest group members, officeholders, opinion leaders, and candidates from all levels of government. It's a chance for some of these people to meet each other and discuss issues, strategies, future candidates, etc. Oh, and if you happen to research parties, this is a pretty great opportunity to talk to a wide range of party members.
Finally, the convention is a chance to witness factionalism within a party. Although party leaders will go through great efforts to downplay dissent, sometimes rival factions will use convention events to make their viewpoints heard or champion certain candidates. Supporters of Hillary Clinton did this in Denver in 2008, and Ron Paul's supporters may try something along these lines this week in Tampa.
For more on these topics, please check out this piece by Jon Schuppe (which quotes my co-author Michael Heaney and me).
Update: I missed Jonathan Bernstein's take on this over the weekend, and he apparently touched on many of the same points. Please read it!