If you are not familiar with Unix, then you might wonder why you would want to create tarballs and then gzip them. Recently I had a directory that was over 12 GB in size and I wanted to zip it up and send it to someone. By creating a tarball from it and then gzipping it, I was able to shrink it down to under 5 GB. That made it alot easier to send to the person.
Another reason to do this is you want to send a file from Windows to Unix. By compressing the file this way, you can be sure that the Unix user can uncompress it in a straightforward way.
For more on this, see: How to Create Tarball & Compress to GZip Under Windows (.tar.gz) | Gettin’ Geek