Vocabularies

Vocabularies are hierarchical sets of terms (categories). They allow you to categorize content. You can categorize content, when you create new content or when you edit existing content.

Categorization is necessary when you are dealing with a huge amount of content, for example articles in a magazine. Proper categorization will help you to sort and present content to your visitors (for example with the "Listing"-plugin as described here).

Go to Site -> Vocabularies in the backend to manage vocabularies.

Rules

You can simplify your workflow by using "rules" in conjunction with vocabularies, when you create new content. Read here for more information.