Rich Text Format is a file format developed by Microsoft that allows you to define text files with formatting, font information, text color, etc. The RTF renderer will read the text from a control source, which might be a Field, Literal, Script or URL. This means RTF text can be read from your datasource, or from a file on disk. RTF is the preferred way to obtain attributed text, where the font, colour, alignment, even line-spacing can vary within a block of text.
To use the RTF component as a literal, you need to paste the raw text of an RTF file into the RTF Wizard (or type it directly, if you know RTF syntax). For example, you can create a simple text with WordPad (on Windows) and save as RTF. Then open it with NotePad, to see the actual RTF codes - lots of { and }. This is the contents you need to paste into the RTF Wizard for a literal value. Alternatively, this is the data you need in the database, if you want to read it as an RTF Field.