What is a tag?
- Creating selected lists - E.g. editors picks or seasonal recommendations - Associating similar colours - E.g you could assign a tag 'Blue' to 'Royal Blue' and 'Navy' products, allowing your customers to search for a more generic term.
Tags example
Here's an example of tags used within the 'colour' attribute. As you can see:

Tags within listings
If you don't want certain tags to appear in listings, you can disable the feature on a per tag basis.