A sound designer can help transport the audience to another time, another location, another world. From a cramped, overly hot theatre on the Lower East Side or the grandest, gaudiest Broadway theatre, the sound designer (coupled with pertinent visual cues, usually) can whisk the patrons away to a humid jungle, Victorian London, a high-school gymnasium. The possibilites and environments are endless. Not to mention the sound designer can ensure that every word is heard, that nothing no nuance, no subtle inflection, no muttered syllable is lost. The sound levels do not need to be overly loud, but intelligible. No listener should have to strain to hear the dialogue or the lyrics or the mandolin, but nothing needs to be shoved in the listener's face.
This page is obviously incomplete, and will probably stay that way.