Mainly two things seperate different video players: the way they look and interact with you (the user interface) aswell as which types of video can be played.
The user interface of a video program allows for control of the program. Some programs like VLC offers the user more options and control so they can fulfill the needs of both advanced users aswell as those with simpler needs. It is more flexible but not all users need this flexibility.
Another major difference lies in the ability to play different types of video. To play a video on your computer, your video player needs to understand the video. While some video files can be understood by just about any video player, some are made differently and needs a video player with special abilities. These video players have the ability to understand uncommon types of video and can play it for you just fine.