Email templates can be used for standardized emails that can be sent manually or automatically based on certain events that trigger the emails to be sent. To map specific templates to specific events see 'Email Template Assignment'. You can also test out the email templates from the action menu on that page.
Email template are configured under Company Settings > Email Settings > Email Templates.
A template can be edited using the WYSIWYG editor and can include images and fonts as an HTML email. Placeholders can be set in the template to be replaced with information from the recipient or related order etc. Common placeholders are:
A directory of valid placeholders can be found here.
Images can be added to the Template using the Image Editor on the tool bar.