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In this tutorial, Ted explains how to convert letters to numbers in Excel, specifically assigning values where 'A' becomes 1, 'B' becomes 2, and so forth. The key function used is called "CODE," which assigns a specific numerical code to each character, including letters, numbers, and special characters. Ted demonstrates the steps in a prepared spreadsheet, emphasizing that this conversion relies on understanding how computers translate characters into numerical values. The tutorial aims to provide simple and clear instructions for achieving this in an Excel worksheet.