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In this video, the presenter demonstrates how to reduce the size of an Excel file without deleting any data. They advise saving a copy of the file before attempting to reduce its size. The first step is to compress picture size by selecting the picture, going to picture format, and choosing compress under adjust. Different options are available for compressing the picture format. An alternative method is to go to file, click on more, then options, and advanced, where image size and quality settings can be adjusted to always compress images.