The idea is to allow you to pick the look of your armor and/or kit when you unlock the variants.
A Lieutenant would only be able to have the amor and/or kit look of the Lieutenant grade equipments.
A Lieutenant Commander, however, would be able to select the look of the Lieutenant or Lieutenant Commander grade equipment...but the stats of the armor/kit would be that of the Lieutenant Commander grade equipment you have equipped.
Commander grade equipment would be able to have the look of Lieutenant and Lieutenant Commander equipment.
Obviously Rear Admiral grade equipment would be able to select from the various looks of any rank of armor/kit equipment.
(Please create your own thread if you do not care for the armors at all. That is not what this topic is about)