TrayIt! allows to save precious Taskbar space for minimized windows. For each application which applies TrayIt! it creates a small icon in the System Tray. (System Tray area is located near the Clock). When application's window is minimized this icon represents the application on the Taskbar instead of the regular "minimized rectangle".
It is particularly useful for background tasks you typically keep running on your PC all day long like your favorite E-mail client, Real Player, etc..