What is the difference between Loro and loro? Also, what is the difference between voi and tu?
II (tu) senti (you feel, familiar) (voi) sentite (you feel, familiar)
III (Lei) sente (you feel, formal) (Loro) sentono (you feel, formal)

Question

What is the difference between Loro and loro? Also, what is the difference between voi and tu?
II (tu) senti (you feel, familiar) (voi) sentite (you feel, familiar) 
III (Lei) sente (you feel, formal) (Loro) sentono (you feel, formal)

Answer

Tu/Lei are singular;  Voi/Loro are plural.

Another point, from my teacher in Florence: "formal" does not equal "honorific".  You use "Lei" or "tu" based on how well you know the person, or how familiar/close you both are.  Eg. if you used "Lei" when speaking to your friend, you have placed a distance between you both.  While "tu" is used commonly, if you use it in the wrong context (eg. business meeting), you would come across as far too friendly and a even little disrespectful.