The document discusses three common image formats - JPG, GIF, and PNG - and provides guidance on when to use each one. JPG is best for photographs and when file size needs to be small, as it is lossy but supports 24-bit color and continuous tones. GIF supports transparency and animations but is limited to 256 colors, so it works well for simple icons and logos. PNG has lossless compression, small file sizes, and transparency support, making it suitable for complex graphics like logos with drop shadows. The document emphasizes choosing formats wisely based on each image's specific needs and testing images across devices.