Flashy graphics are nice, but many people don't bother to wait for lots of graphics to download and just abort the page and go elsewhere. If it is not presentable or needs to be reduced again by a different amount, use your image editors 'undo' feature or reload the original file. You want your resulting file to occupy between 3,000 and 20,000 bytes of disk space - this should result in reasonable download times for web browser users running on 14,400 baud modems. This is the image that you will be uploading using FTP, or attaching to an Email message to send to the Web Page maintainers. Don't give people TIFF, PS, EPS, or any other file format - odds are good they won't be able to view them from their web Browsers.
Image files are binary data.
GIF files can only save images at 256 colors. Most people running on MS Windows PC's will be running at this resolution. JPG files tend to lose resolution as they compress the data. This saves greatly on disk space, but affects the image quality. Verify that the image looks good frequently while working on this file type.