Because you can set up laser targeted landing pages for each ad group.
For example I have a campaign running that has about 6,000 keywords. These keywords are in tightly nit ad groups and each ad group had about 5-10 keywords in.
To keep your quality score high and thus your ad costs low, keyword, ad and landing page must be all be of good quality and be relavent to each other.
I then point these ad groups to dynamic landing pages which have exactly what the searcher is looking for.
Another reason for many keywords and ad groups is that some campaigns are geo-targeted. An example of this is dating:
dating liverpool
singles liverpool
lesbian dating liverpool
women liverpool
etc....
if you mutliply this by all the towns and cities in the UK then you have quite a big keyword list to manage.
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