Almost every game with random rewards sorts them into named rarity grades. The convention persists because it solves a communication problem and a pacing problem at the same time.
Players cannot evaluate items quickly
An item in a role-playing game carries several numbers and often a special property, and comparing two of them properly takes attention the player would rather spend elsewhere.
A rarity grade compresses that comparison into a colour or a word, letting a player decide in an instant whether something warrants inspection.
This matters most where rewards arrive frequently. A system that drops hundreds of items requires a filter the player can apply without stopping.
Tiers give designers a pacing control
Once items are graded, the drop rate for each grade becomes a single adjustable number that changes how progression feels without touching any item.
Lowering the rate of the top grade slows advancement across the whole game. Raising it accelerates everyone equally, which is far simpler than rebalancing individual rewards.
This is why rarity systems survive rebalancing patches unchanged. The structure is the instrument, and the numbers within it are what get tuned.
Rarity has to correlate with power imperfectly
If the highest grade were always the best choice, inspection would be unnecessary and the system would reduce to a single number.
Designers therefore allow lower grades to be situationally superior, usually by attaching properties that suit particular builds rather than raw statistics.
The tension is deliberate. Rarity has to be a reliable shortcut most of the time and wrong often enough that engaged players still evaluate.
Randomness needs a felt structure
Pure randomness produces long unrewarding stretches that players experience as the system being broken rather than as normal variance.
Tiers let designers apply protections: guaranteed minimums after a number of attempts, or increasing chances that reset on success. The grade is what these rules attach to.
Without a graded structure there is nothing for such a rule to reference, which is why games with continuous reward scales still introduce thresholds.
The vocabulary became a genre convention
Colour coding and tier names are broadly consistent across many games, and players arrive already knowing what the colours mean.
That shared vocabulary is valuable enough that studios rarely deviate, even where their reward structure would suit a different presentation.
Games that do deviate usually spend part of their tutorial teaching the replacement, which is a real cost paid for a clarity most players did not ask for.