We tested all popular file archiving and compression formats to find which type is better to reduce file size for a big group of different files and for some popular file extensions (JPG, PDF ..).
Archiving: groups many files into a single one. The size of archive will remain the same.
Compression: reduces the size of file(s).
Archiving + Compression: is what you are talking about, programs that will archive and compress files in the same time. Often, these programs are called only file archivers or file compression software (WinRAR, WinZip ..), but in fact all are making both tasks: archiving and compression.
.zip is the most popular, followed by .rar and .7z. Most popular doesn't mean is the best. .zip archives can be created with any specialized software, including free ones.
.rar archives can be created only by a few programs (WinRAR), because is a proprietary license (paid).
All file compression programs are able to extract all mentioned archives.
.tar is only an archive containing multiple files, without being compressed. For example, when we put multiple JPG images in a .tar archive, the size of .tar file will be the same as all contained images.
.bz2 and .gz can compress only a single file at once.
To create archives with multiple files, first we need to archive them in .tar format, then we compress this single .tar archive with .bz2 or .gz and will result archives like tar.bz2 and tar.gz
For each file format we tried to use the default software to generate that kind of archive. We used the following programs:
.7z is the best format to create an archive and to reduce the size at maximum. There are many programs able to create this type of archive and almost all are able to extract the files. See a list with best free and paid programs and their supported extensions to create or extract different archives on this page. You can use programs like Bandizip, PeaZip or 7-Zip.
The only file type where .7z extension isn't very good at reducing file size is .exe (executable program). For .exe files, .rar and .zipx formats are the best.
To reduce file size of .exe files at maximum you can use Bandizip to create .zipx archives or WinRAR (paid) to create .rar. Or you can use the popular .zip format to archive .exe files, with a pretty good file size reduction.