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In this tutorial segment, the instructor addresses a common issue where users want to rotate individual letters in a word rather than the entire text. The default option rotates the whole word around a keyframe, limiting flexibility. To overcome this, the instructor demonstrates how to create shapes from the text. By selecting the text layer, users can navigate to the Layer menu, choose "Create," and opt for "Create Shapes from Text." This action hides the original text layer and generates a new shape layer, allowing for individual letter manipulation, thus enhancing creative possibilities.