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In this video, the tutorial demonstrates how to compress a Microsoft Word document to reduce file size for faster loading times, easier sharing, and optimized storage space. The Word file shown is 11.1 MB containing text and images. To reduce size, select a picture, go to Picture Format tab, click on Compress Pictures icon, uncheck "Apply only to this picture" and check "Delete cropped areas of these pictures". Select Default Resolution and click okay. Save pictures at lower resolutions by going to File, More, Options, and Advanced in the left panel.