Once a thief has stolen his 10th iPhone that he can't do anything with, he'll probably be less likely to bother stealing iPhones. If anything it's a liability since it can be tracked as long as it still has some battery.
Theft isn't just for the whole device, it's also for parts. By making the part market so difficult they essentially create a black market for it in third world countries where just the phone's battery could be worth a day's wages.
A day's wage in Colombia is about $10-15 and people tend to preference and pay more for original parts since the cost of the device is too high to risk. An iPhone X costs close to a month's salary. They even tend to avoid third party cables or chargers as a consequence.
For phones which are in a case/cover, inside bags etc., it seems almost impossible so am unsure that this is an effective deterrent.