Using web-based email clients was a nightmare before Gmail. They had limited storage space, and the UX was pretty bad, they were hard to search, etc. You spent all your time figuring out what you wanted to delete, or seeing your emails bounce when people had full inboxes. If you didn't log in for a while, your account would disappear.
And then suddenly, you got a GB of storage. For free. No questions asked. And its UI was simple and easy-to-use. And you could search it.
A lot of other products are 10x better in individual areas. For instance, Google Sheets was much more portable/shareable than Excel when it launched. But even today there's no comparison, Excel is superior for actual spreadsheet functionality. But Gmail was better on every axis, even against local clients like Thunderbird and Outlook.