As I recall, Google had no ads. A small text ad, maybe, but I think that was added later. They also did a much better job of removing spam from my inbox. In addition they offered a lot more storage for free, which was actually a concern at the time. I'd have to go through and purge my email because simple emails with images were forcing me to manage my old emails. This became a problem over time with Hotmail, which I used, because I wanted to save some emails for their historical value or value to me.
Gmail jumped right on common features like folders and tags, and continued to expand further than other free email clients with better search functionality, easier multi-account SMTP and POP management through a single account, which I use for my 15 email accounts to this day, and automated filters that allowed me to make sure I saw certain emails or didn't see others unless I wanted to.
I think for most people it was just a clean interface, more storage, and better spam. But it also had features for more advanced users that made both tech amatuers and pros prefer it.
Now my common name email address is a curse of unending spam.
Later they played up "better SPAM filtering" (specifically fewer false positives) than the competition (whether it was better I cannot say, as I have never been a gmail user).
Also a help: A generous free allowance and snappy clean interface at the time (2004?) plus the old waitlist invite only trick for fake scarcity.
This was in the MSN / Yahoo bloaty web heydey too.
In Germany it got rapidly adopted because the competition (web.de and gmx.net, both from 1und1) had less than 10MB space and had a hard limit of 100 mails, no matter their size. And more importantly: no way to download the emails and to archive them.
The most ironic thing was the animation of the storage size on Gmail at the time, because it was growing daily, and they made a counter animation that was increasing storage size (e.g. 1.12345 gigabytes and growing) due to them heavily investing in data centers at the time.
It was invite-only, which possibly made it seem more desirable than it might otherwise be. But really, I think the biggest factor was its portability. At the time, you tended to use either your work/school email or the email associated with your ISP, both of which could change over time. You can keep your gmail address forever, and people saw that as a benefit.
There were competitors, but they had clunkier interfaces and smaller storage. GMail showed what web apps could do, in a way that's old hat now but was rather shocking at the time.
But you also have to keep in mind that other webmail services were rather simple and slow. Most users still used an actual mail client.
2. forever beta stage, requiring phone number. this made it more exclusive.
But I think the service truly exploded in popularity with Android phones asking people to either sign in or sign up.
It was free, with essentially limitless storage (or that's how it seemed at the time).
The UI was decent, fast, with no page reloads -- it felt responsive, like a native app.
Google seems to be the first to really leverage the large number of their accounts to catch spam more effectively than the other providers. You basically got no spam from GMail in the beginning.
Yahoo and Hotmail were both super clunky in comparison: slow, ads, more spam. It really was no contest.
And then Android just meant nearly everyone got an account ...
Remember this was in the IE 6 days. I remember reading a Google blog post about how they reverse engineered some aspects of the IE JavaScript engine to optimize their code.
Reason #2, it was invite only and it had this sense of "exclusivity" that eventually went away.
The storage, though. That was the true hook.
2. The interface was far superior.
3. Essentially completely free.
It basically blew every other option out of the water at that time.
I tried to use live.com lately, and it is not as good.
I also use Protonmail and others, but Gmail usually works better.