Formats are various ways of displaying content assets. Each format applies to a specific type of asset, so when a format is added to an experience, an asset is also added.
The top level folders in this section list the types of assets that can be used on a page. Within each asset folder is a set of formats for that asset, which define how the asset should be displayed.
Select the desired format and drag it into the appropriate place in the experience. Enter its properties on the "Properties" tab.