Matchmaking is only one piece of the puzzle, it provides an easy way for new players to start playing the same standard ranked games that they see the pros play on twitch and mixer, bridging the ease of access gap is what made Dota and CS:GO blow up the way they did.
Dota and CS games were plagued with very similar issues as what you see on HD and the DE lobby - finding balanced games was hard and almost impossible, there was a large gap between skill brackets and improving was difficult because most games were complete stomps in either direction.
Ranked lobbies help but there can still be a big difference in skill between two identically ranked players if one of them plays all their games as 4v4 BF and the other plays only 1v1 Arabia, in such a case your ELO isn’t too comparable to others unless you know where most of their games came from.
When ELO is focused on a standard set of settings in a matchmaking queue (as it happened with Dota 2 and CS:GO), it becomes infinitely easier to find opponents of a similar skill level and play a balanced game with the click of a button, suddenly the games become a lot more fun and the online player base grows.