It seems like the Echo is a repackaged Siri, with an optional wake word. The Echo Dot lets you buy stuff through it much like the Kindle which seems to be Amazon's thing.
Ya -- one that permanently has a place in your home so you don't have to worry where your phone is, one that integrates with popular 3rd party home-based IoT, is always listening/on, works better than Siri, and comes with better and free music integration (but is better if you're a prime member). The dot is just echo junior, there is no difference in utility of it.
The result is a very meaningful improvement and a change to how you interact with technology in your home.
The Echo is terrific and (unlike Siri) I wouldn't be without it. Sadly, Amazon's management app for the Echo is an unstable, slow, buggy piece of unusable garbage that someone should be fired over.