Normally, when you connect with a fairly normal 2 hour connect time, the containers for the next flight are already being made up in the baggage cellar - there will be an assigned position for the bags to be delivered to.
When you are making a longer connection, your bags need to go into a holding pen until it's time for your flight to be made up.
As I recall at LHR T5 this is done using a robotic automated "warehouse" in the catacombs which knows where each stored bag is and what flight it's for.
When it's time to make the load up for the flight, your bag (and any others for the flight) are automatically retrieved from the holding area and sent through the system to the appropriate place in the baggage cellars.