In the other world, Mr. Bobo is really scary. Maybe because he isn't really even a person:
Coraline took a step closer to the man, and he fell apart. Black rats leapt from the sleeves and from under the coat and hat, a score or more of them, red eyes shining in the dark. (10.26)
We think we've seen something like that on Buffy the Vampire Slayer. Totally horrifying.
Aside from being made up entirely of rats, what else is different about the alternate Mr. Bobo? Well, he runs a successful – and completely disturbing – rat circus instead of a mouse circus. To top it off, these rats are all evil and are in cahoots with the other mother (that means they're on her side). By comparison, the real Mr. Bobo is downright normal and boring. (The fact that he isn't made up of rats is also a huge bonus.) Other Mr. Bobo helps us see, in a concrete and totally disgusting way, the major contrast between the real world and the other world.