Additional insulation will always reduce the heat loss in that direction with everything else being equal. However, there is a point where the additional cost of the insulation will not be recovered by energy savings.
In addition, there is a point where you will not see a benefit to the additional insulation as the losses in the other directions (bottom of tank, top of tank, conduction through the piping, etc.) will dominate the losses.
Most modern tanks benefit little from the blankets compared to the older tanks. I know that the manual for my GE/Rheem (electric) specifically states that a blanket is not needed.
Where is your tank located? Garage or in conditioned space? If inside, the dT is lower during the winter (compared to a garage/attic) and the heat loss does go into warming the house, so the heat that is "lost" isn't really lost.