Testimonials can be powerful, so long as they're genuine and well-written. Think of them like a product review, you'd want to buy something people are talking about with praise. The person giving the review counts too. Some random client from a company nobody knows will do the job, but someone from a recognised brand or organisation can do wonders. Think of it like a celebrity endorsement (do people actually believe those???).
Listing clients (on websites for example) is supposed to do the same as a testimonial but in a faster, more visual way. It's like a 'strength-in-numbers thing – "If this designer/studio can handle work for these companies, then surely they won't mess up mine?"
You could also argue that they are there to instantly give a potential client an idea of your rates or experience level – "Oh, this guy did work for Coca Cola, he must be good" or "Ooh, she's worked with American Airlines, she probably charges a lot."
I added some client logos to my own portfolio some time back. Why, I don't know, mainly because there was a space in my WP theme for it, but also because, well, that's what people do nowadays…