Templates are patterns for the look of a web page. They contain the data with which CMSimple_XH creates the visual aspect of your internet pages. Simply load a different template into your CMSimple_XH site, set it as active and you may not recognise your site again.
A demo is better than a thousand words. Therefore you might have a look at the CMSimple_XH demo site with the plugin TemplateSwitch_XH. On top of the main contents of each page you can chage the template via a selectbox. The contents of the page will remain unchanged, you will just see the contents via different templates.
On the following pages you learn how to install and activate a template: