People tank when they feel they can't compete. This could be because they are up against teams that have either bought a lot of tokens (and they refuse to spend real money on this game), or because they are up against teams who have farmed (completed online offers like watching videos in exchange for tokens) lots of tokens.

Depending on what country you are from some people can get a better advantage than others by taking part in offers etc. Some view trying to get promoted with a 3 star squad - which will then become a 2 star squad on promotion as being pointless as they would be too weak to compete the following season. They then decided to "tank" the season by playing people out of position so that they can have a go at winning promotion and the league/cup the following season with a stronger squad.

Personally I wouldn't tank, I would always try to get promoted, but its up to each and every user how they go for the game. Some like to make the Champions League at every level and will forfit promotion to hit that goal - others just want more trophies in their cabinet. For me I want to be at the highest level possible - so I always aim for promotion regardless of my and my opponents squad strengths.