The Theological Dictionary of the New Testament summarizes arete (αρετη) as “eminence; excellence of achievement, mastery of a specific field, or endowment with higher power.

So, 1 Peter 2:9 recommends that the faithful “proclaim the arete of Him who called.”

Philippians 4:8 suggests that the faithful meditate on, among other things, the idea of arete.

2 Peter 1:3 defines how people are attracted to the gospel: Jesus’ glory (His parade of godly character traits) and arete (His mastery of life on earth).

2 Peter 1:5 pushes arete into the expectations of the faithful for themselves: add to your faith arete, to arete knowledge…

My impression is that the use of arete has to do with associating the somewhat philosophical and distant concept of godly character into the physical world, associating character with mastery of life on earth.  We are not just biding our time, waiting for the end of life or the end of time, whichever comes first.  Rather, we are endowed with higher power (the indwelling Spirit) through which we become those who grasp life, literally and figuratively, and have it under our control.

A big part of that mastery of life is the concept of being consistent (teleios, generally badly translated as perfect, mature, or complete).  Without consistency, we are adrift, masters of nothing.  In contrast, the definition of grace is “the collection of godly character traits with special emphasis on the way those traits are integrated and consistent.”  So, the faithful gain in grace (again through the work of the indwelling Spirit) as they become masters of life (arete) through consistency (teleios).