The easy way!
Bad handwriting? No drawing skills? No problem!
Put the mold on place and use tape to keep it in place.
Cut the holes of the o's, p's, d's... on a piece of tape.
What I do is place a small piece of tape on the paper letter and draw the inner circle with a pen/pencil, then put another small piece of tape on top of it and peel is carefully, it will keep the mark so you can cut around it and won't ruin the papper in case you need to do it more than once.
Important note. Place a plastic bag, or another cloth or cardboard between the layer to paint and the back :D
When Everything is on place put some pain on the sponge (or fabric) and apply it with touches small touches all over.
Don't brush or move the sponge on the fabric because then the clothes with move and ruin the image.
Remember you can use any number of colors as you wish. ^_^