Embroidered and PVC are the two patches we're asked to compare most often, and the honest answer is that they're built for different jobs rather than one being simply 'better'.
Embroidered patches are stitched thread over a twill backing. They read as classic and textured, work beautifully on jackets, uniforms and caps, and hold fine detail well at small sizes.
PVC patches are molded soft plastic in a raised 3D shape. They're fully waterproof, which makes them the better call for backpacks, outdoor gear and anything that sees rain or mud.
If your design leans on fine text or a vintage look, embroidered is usually the right call. If it needs bold color, a 3D pop, or has to survive the outdoors, PVC tends to win.