Courtesy of dyedude22
Concentrate on Tests, Not on Remembering Details
When you are testing your game, especially an action game, there will be many events distracting your attention from the test result. It can become quite hard to remember if it failed or not. Recording plays separates memorizing test information from creating it. So you can focus just on running a good test.
Detect More Bugs
The devil is in the details. A game may have bugs you don't notice while playing. This is true especially for fast-paced games. Slow motion playback may unveil unknown flaws.
Videos Say More Than Thousand Words
Try to motivate your testers to record videos as well. A video is much better than any written report explaining how the tester played your game. The footage also may bring some unknown aspects to light like missing use of features or dumb enemy behaviour.
Use Best Frames For Marketing
Playing through a level and hitting the PRINT key in the right moment isn't that easy, especially in action-packed situations. And people love action-packed screenshots. Do yourself a favor and record your play to choose the best screenshots later from the video.
Use Best Videos For Marketing
Sometimes you may get lost in your own game, no longer thinking about the test case you fired the game up for. You play through the level just to see if you can beat it. If it's a good run, why not show it to your audience? Screencasted tests can become interesting marketing material.
Make Test Results Persistent
Gameplay tweaking is an iterative process where you change attributes and compare the new implementation/configuration with the old one. Videos conserve the states and can be compared better than two runs kept in mind or explicitly written down. Trace and store your progress (semi-)automatically.
See it Like Others do
Working on a game can make you blind to its audio-visual attractivity. You may think it's really cool with all it's explosions, details and speed. Try to record your game, don't play it for a weekend and then watch the video. Maybe it's not as good as you thought a few days ago. Passive viewers will be more focused on the overall impression than on details. Finally passive viewing will be the usual way for people to judge your game.
Tools for Recording
Now that you have heard about the advantages of playtest recording you may want to know which programs there are. I don't want to waste my time on writing a list of such tools. Simply because Pixel Prospector has the definitive guide to get the best solution for your needs:
How to Record and Edit Gameplay Videos
From all these great tools I chose Fraps (37$) for recording, VirtualDub (0$) for transcoding and Wax (0$) for editing. Selecting the right tools depends heavily on your development machine's specs and which type of game you are making. Pixel Prospector will show you what's best for you.