This is a good question and it's the second time it's been asked of me this week. If we look at the way people are 'wired', they react to their environment. So, they are affected by temperature, colour, light etc. Even people in the industry who look at homes all the time react this way... and it takes a special person not to react, and to envision it with their own furniture.
In new construction, staging is less of an issue because the paint is perfect, the colours are all chosen to appeal to the general public, but still a lot of builders stage the show home, so people can envision themselves living there.
A house that's not new can 'cost' a seller a lot of money if it's empty. Wear and tear shows up in a re-sale home more easily with nothing in it: Traffic patterns on the carpet, nicks in the paint etc, cracks in the tile - all these things are not major but when the house is empty - the eye is drawn to them. Sometimes buyers can over-deduct for changes they want to make. How you, as a seller, can overcome this by staging. Staging may save you money in the long run as the money you spend on making the house more appealing to buyers. They'll see less 'wrong' with the house. And, the cost of staging may be less than your first price reduction.
Thinking further about this... staging a home demonstrates that care of the home has been taken by the seller. Buyers are often worried when they purchase a home, if it has been well maintained. So, that is why it's important to have good curbside appeal, a clean and tidy front door with a lock that works, beds made, clothes away, a clean and empty dishwasher. And, we haven't even gotten to the staging yet. I'm often reminded of a seller whom I was taking out to view homes. After viewing the 5th home and seeing underwear strewn all over the bed, mismatched shoes on the ground and kids arts supplies scattered throughout the playroom, she drove home and cleaned her own place up. So, if selling, do yourself a favour, go and look at some other houses and witness within yourself, whether or not a clean, tidy and staged home does make a difference to you. I think you will find that it does.