Adding hints about what goes inside each form field can improve completion and conversion rates. These hints are usually provided with labels and placeholders.

Labels tell users what information belongs in a field and are usually positioned outside of it. Placeholder text is typically an example of the information users need to enter and is located inside the field itself. 

Don't rely on placeholder text alone! It disappears when users start typing, and they must strain their memory to remember what it said. It's also terrible in terms of accessibility. For low-vision users, the contrast can be too low to see, and many screenreaders can't read placeholders.

You should only use placeholders as an addition to labels and not as their replacement. Another option is to use floating labels placed inside a field like placeholders — they move to the top of the input when users start typing.^[1]