Normalized state prevents duplication and simplifies updates.
Nested (problematic):
posts: [{
id: 1,
author: { id: 10, name: "Alice" },
comments: [{ author: { id: 10, name: "Alice" }}]
}]
Alice appears multiple times. Updating her name requires finding all copies.
Normalized:
users: { 10: { name: "Alice" } },
posts: { 1: { authorId: 10, commentIds: [1] } },
comments: { 1: { authorId: 10 } }
Each entity stored once. Update in one place, reflected everywhere.