You can cut the pieces out of felt, fleece, or any fabric really.
A little detail I added is the feather body.
Using brown craft feathers, I placed them on my fleece body and zig zagged down the center shaft of the feather to sew them on. I added the eye buttons and green belly buttons too.
I chose to put this little owl on a tote for my little guy.
Santa brought a couple trains for Christmas, and they never leave his side. It used to be Woody, but now he's been abandoned in the toy box since Christmas morning. He takes these trains everywhere and even sleeps with them. So I made this little tote so he can lug them around easier.
I'm sure there are free tote tutorials around, or you can sometimes find little kid sized ones at dollar stores too.
I use grosgrain 1" ribbon to make quick easy handles on mine to save time. Who wants to turn a skinny tube of fabric right side out?
Like any applique, you could sew it on a shirt, bag, wherever. So far it's been nice to have a little tote for my toddlers treasures.