Out of respect for the etsy seller and originator of this idea, I won't post a full tutorial, but I did want to share one tip that helped me make a casing around the edge of a circle.
Sewing neatly around curves is tricky, especially when you want to turn under the seam...as in a pocket or here with a round cover. My best advice is to sew a long basting/gathering stitch along where you want to fold the fabric over.
By gently pulling the bobbin thread tighter, you make the fabric pucker in the direction you want to fold it.
The covers turned out really cute. The owl one I made with a longer skirt to make more of a ruffle.
I also added some ricrac to towels to match. I have added ricrac to towels previously, but wasn't happy with how they looked after multiple times through the wash (unless you like ironing your towels!) So, I zigzag stitched the edges to match the towel, and then sewed along both sides of the ricrac to hold it all in place.
Have you worked on any handmade gifts lately?