Image compression software allows large images to reduce in file size without losing aesthetic quality.
Larger image file sizes mean a webpage is going to take longer to load and long page-load speeds are directly correlated to high bounce rates (people clicking away from your site out of frustration), and therefore lower Google rankings.
Compression does not mean reducing the dimensions of the image. For example from 2000 to 1000 pixel width or reducing the pixels per inch (PPI). This is a basic design error and causes terrible distortion when viewed on different sized screens, particularly on newer Retina LCD’s.
Below we see an image in its original format (taken on an iPhone 6) vs the same image compressed using image compression software. The result is an image 12% of the original size with negligence quality loss.