The problem is that it is a "template" you located on the Avery site. They don't actually download templates. They generate Word documents in the deprecated .doc file format & include shapes created by the abandoned graphics generator which aren't compatible with the current software.
Go to File> Convert Document in the main menu. You then should be able to access the Shape formatting features but you still may not be able to do as you wish in many respects. Apparently the documents generated by these so-called templates are intended to used as is. They can be a real rats nest to modify.