It's become a big thing because it's convenient. Every time I sign into 1Password on any of my devices, all of my passwords are there. I don't need an account with Google, Dropbox, or Microsoft for it to work and I don't need to do any manual setup. It "just works", which is exactly what the average person wants their software to do.

Manually dealing with files is a sign of poor software design for simple use cases, in my opinion. I quite like the iOS model that abstracts the idea of a filesystem away from the user because the user never cared about the file system anyways. They just had to deal with it to do whatever they really wanted to do.