What to hang: Towels, robes, scrubbers, and clean clothes to change into after your shower. Use a basket up top to stow lotions and cleansers you use frequently. Look for a rack like this one, which has bars for hanging towels as well as adjustable hooks to accommodate items of different sizes.
Where to mount: Put a rack high enough so your robes can hang without dragging (and at a height, usually six feet, at which no one will bump his head).
Tip: Tiny bathrooms need hooks as much, if not more than, larger ones do. But some racks might be too big for a small space. Try a system with shallow hooks, like the Elfa White Basket with Six Hooks ($15, containerstore.com), which projects only 5¼ inches from the wall and holds toiletries in its small basket. It can even be mounted on the back of the bathroom door. You can also mount a series of single hooks, arranged horizontally across a wall or door.