The sound of an electric guitar is often coloured by some form of guitar effect. This can be something as subtle as EQ (equalisation) or as dramatic as heavy distortion and delay (echo).
Guitar effects are created to alter the natural sound of the guitar to generate a more emotional response from the listener and to match the mood of the song that is being performed. Certain types of sounds will usually create an emotional response and the effects help to achieve this by altering the tone of the instrument and adding other factors such as reverb to change the spatial awareness.
Most guitar effects are produced via effects pedals or alternatively multi-effects processors. The difference is that some effects pedals supply only one singular effect whilst a multi-effects processor can combine several effects simultaneously. The latest state of the art guitar effects involve digital modelling where a guitar (via the use of digital modelling software) can be transformed or "morphed" into a completely different instrument.