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The video tutorial explains how to make items in a drop-down list appear in alphabetical order, even if the original list is unsorted. The presenter demonstrates with a list of office items and mentions three types of drop-down lists, directing viewers to another video for more information on those. The key technique involves using a formula to rank items by their alphabetical order and creating a new list based on this ranking. A match formula is then utilized to arrange the items alphabetically. The process is simple and does not require manual sorting of the original list.