It makes no sense: you can talk your way out of being caught stealing, but not even try to calm down people. Also people reactions aren't consistent: they flee from invocations, yet doesn't have any problem fighting way stronger and monstruous foes. And why should it only affect friendly NPCs? Why are hostile foes suddenly immune to fear?
So the way it is currently implemented, it is neither immersive (because of lacks of consistency) nor practical.
