I think the one reason that applies most often is when one of your pawns end up on d3/6 or e3/6 which makes developing the bishop that usually goes through that square harder. If you don't want it to end up locked and inactive then fianchetto is a great shot. You may still develop to Bd2/7 or Be2/7 and then go out the other way but you usually won't activate your bishop as much as when you fianchetto.
When do you Fianchetto?
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I've been playing Chess since about 1988; probably 99% of my playing was between 1990 and 2000, just starting to get back into it now. In all that time, I don't think I've Fianchettoed a Bishop more than 5 times; just never seems like the right move to me (I play 1. e5 as White, and French Defense a Black)
Not counting Book openings that include a Fianchetto as Main Line, how do you decide when to use it?