Just like all the rest, you supply them with a URL to shorten. But the best part of bit.ly is what they do after the shortening. If you sign up for an account, you can track your links... see how many clicks you've gotten, what date, time, etc. They also archive all of your links, so you can just copy and paste again when you need the link. Bit.ly also allows you to post directly to Twitter, making the whole process much more streamlined.