Wikki Stix can be cut and used to underline letter combinations in books you read outloud to a child. Turn any book into a phonics lesson! Books with glossy pages work best. Wikki Stix may leave a little color or rip a little paper if pressed on too hard or left on too long. I suggest you don't use Wikki Stix on library books, but the benefits of this activity may be worth a little damage to your own books.
The next pictures show underlining of "ou" in different books. Introduce the underlined sound. Have a child repeat the underlined sound. Separate the underlined sound when reading the word and have a child do the same with his or her own voice. Beginning readers will learn to identify common letter combinations, make the sounds for common letter combinations, and blend sounds from the beginning to the end of a word. A child will learn to decode words with some support from you and great books you would've read aloud anyway.
(CL - OU - DY)
(M - OU - SE)
(SH - OU - T)
(OU - T)
Here is a post with some other common phonograms to point out in books.