Templater was designed to be extensible. This means that it was designed to include parts of the system in runtime.
Formatters are one of the extensible parts of the system. They are designed to add additional formatting functionality and expose it though metadata written in templates.

Metadata based plugins can be simple ones like bool(YES/NO/MAYBE) where boolean value will be replaced with YES, NO or MAYBE pattern, or more complicated ones like join(SEPARATOR) where array elements would be joined with SEPARATOR.
They are useful for converting domain model to presentation without doing all the conversions in the domain model.
More complex use case would be to convert input into an image.
For example if the value in the tag represents an id of an image, then plugin could load up the image from the appropriate location and provide it instead of the original image id value

Where there is some pattern in conversion, like format(PATTERN) or bool(YES/NO), it's useful to create required formatter and use it.
The downside of this approach is that your formatters are leaking into your templates, which can sometime look confusing. But this is also a strong point, since you don't need Word/Excel add-ons.

Since plugins can be registered during initialization (and depend on external state) there are various use cases for formatter plugins:

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