First there is the respect aspect. Clothing provides a type of privacy, but can also be a means of showing respect for others. Anything that causes strangers A and B to show respect is probably a good idea. I respect you. You respect me. That's the basis of society. Its important in a violent species such as ours. There are places where its warm and clothes are optional, yet even there people have ways of showing respect. I'm not saying you can't show respect without clothes, but they can help a lot.
Of the apes, humans are not necessarily the most violent but are somewhat violent. Hiding in plain site is very important. Its a skill, but clothes help with it. I know that sometimes we want to stand out, but usually we don't. We've all probably seen Madonna's half-gloves. They look great, but how many other people are wearing them? Only baseball players are, right? That's because everybody wants to look like everybody else.
If I'm slovenly it means I don't respect you, and to a lesser degree it means I don't respect myself. If my house is disorderly and you enter, I feel embarrassed. Why? Is it merely that you might think less of me, or is there something else? If you were someone important to me I'd have cleaned up before you arrived, wouldn't I? You know this. Clothes are similar. If I don't care how I look what it means is that I think I don't owe other people anything -- any respect.