Google's suggestions for "snorkel." Click to enlarge.
When you type into Google "go snor," the suggestion pops up "best places to go snorkeling." Snorkeling is hard to spell (I got it wrong the first time), so many people quickly accept the suggestion.
Google Suggest was an experimental feature before being officially launched in August 2008. As the link suggests, the feature clearly has many benefits to users (especially the poor spellers among us).
The real magic, however, is how it cuts down on the seemingly infinite amount of ways to express a given idea. If there are 20 common ways to search for "snorkeling," Suggest might direct most people to the top 15.
Google also suggests phrases for its AdWords advertisers, who bid for the highest placements for a given set of search keywords. Suggest helps Google act as a middleman between searchers and its advertisers, by allowing them to express the same thoughts in mostly the same ways. Otherwise, an advertiser could have bid on the other 19 snorkeling keywords but would have missed out when I typed "go snorkeling"--a phrase it had not accounted for.
Notice that not every snorkeling-related query goes to the same place:
best snor = best snorkeling in the world
snork = snorkel gear
where should i go sn = (Google doesn't have any suggestions at this point)
But again, "best snorkeling in the world" is now a better keyword for Google, as more people are directed to it than otherwise would be.