Simple: Decoration + warmth. Layering your walls with an air gap and a rug makes a big difference on the comfort of a room in the frozen artic.

Without watching the video i can tell you many cultures in colder climates uses rugs and carpet on the walls to make it warmer and more attractive inside their house. Then it became a status symbol to have the best hanging rugs instead of a carpet on the walls. Really, white people made awesome rugs back then it was a skilled trade. Painting with out paint. Good times.