They are brilliant and powerful tools, and well worth learning how to use. Basically, you store a layer or set of layers, or even import another file as a smart object. You then have a smart object layer which you can resize, rotate, mask, apply layer styles to, etc, but the original content remains separate and unadulterated. You can make copies of that smart object which remain linked with the first. You can at any time, open that smart object by double clicking the layer icon, and edit it in it's original form. Saving changes will automatically update any instances of that smart object in the parent file.
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