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This tutorial demonstrates how to create a word document with an image placeholder using a tag named "image". By clicking on "generate document", the default data includes some base64 code. However, the update allows users to supply a URL instead of base64, making it easier to work with simple text. By providing a valid URL for the image placeholder, users can see the image displayed in the generated PDF document. This feature eliminates the need to work with base64 code and simplifies the process of adding images to word documents.