It's easy to compress a sorted dictionary by turning something like

  a
  ab
  abc

to

  a
  1b
  2c

where the prefix is the number of characters shared with the last word (and might be coded as a byte as opposed to a digit like you're thinking there. This would be a simple form of compression to code up in BASIC unlike Huffman or most LZW variants which involve bit twiddling and maintaining tree data structures... Though I do remember writing SQ and USQ [1] in BASIC)

[1] https://techtinkering.com/articles/compression-and-archiving...