The lightness method averages the most prominent and least prominent colors: (max(R, G, B) + min(R, G, B)) / 2.
The lightness method tends to reduce contrast.
The average method simply averages the values: (R + G + B) / 3.
The luminosity method is a more sophisticated version of the average method. It also averages the values, but it forms a weighted average to account for human perception. We’re more sensitive to green than other colors, so green is weighted most heavily. The formula for luminosity is 0.21 R + 0.72 G + 0.07 B.
The luminosity method works best overall.