I got these alphabet playdoh stampers from Lakeshore Learning when I was still teaching kindergarten in California. These are great fun to use and I have both this set and the uppercase alphabet set that comes with numbers too.
Using these was one of my beginning of the year centers, I'd put these in a center tub along with word cards and my students would stamp words into the playdoh. The center would cover many skills such as matching (letters) and letter identification. Later on in the year the kids would use them to spell out their own simple words.
I recently began using them with ER and she likes them a lot. We call it writing in playdoh and she'll ask to "write" letters. I think these are especially useful if your child is not ready to begin writing practice.
You can also use alphabet shaped cookie cutters but I find these are even easier to use. My daughter cannot get the letter shape out of the cookie cutter without distorting it greatly.