I would think they use Photoshop and other picture manipulation software.
I use Gimp to watermark my pictures. and I've made some watermarks and stuff. It works for digital scrapbooking as well.
For the book covers I have done - I have used GIMP
Connect with CafeMom:
Switch to Mobile Site
Getting Started Guide
Frequently Asked Questions
Part of the CafeMom family of sites
© 2013 CMI Marketing, Inc. All rights reserved.