While others gave great ELI5 explanations, I‘ll try to give you an example of data compression.
For simplification I‘ll use text. Normally text is saved in 8bits per letter/sign. Computers always need the 8bits(8 times 0 or 1) to work with it or show it on your program. If we take the word Oklahoma it would be 01001111(O)01101011(k)01101100(l)01100001(a)01101000(h)01101111(o)01101101(m)01100001(a)
To zip it we try to find a way to shorten it, cause we’re not using the whole alphabet. For example
a=00,O=01,k=100,l=101,h=110,m=1110,o=1111
So Oklahoma would be: 01100101001101111111000
If we compare it to the original: 010011110110101101101100011000010110100001101111011011010110000100100000
Wow nice we have the same information but way less storage was used. Unluckily our computer still wants an 8bit long data format to work with it so we need to unzip it again. The benefit is though you can share the compressed data to your friend using less data. Or you can store more files on your disk.
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