Google Docs variables allow users to insert dynamic data into templates, enabling consistency and streamlining workflows. By using variable chips, users can fill in repeat fields with a single edit, reducing errors and increasing efficiency. This feature is available on eligible school or work Google accounts, and can be used for various applications such as HR, marketing, accounting, and e-commerce. Additionally, variables can be combined with other automation tools like Zapier to further automate the process of filling in document templates.