I did this picture to see if I could recreate something I saw in class, and now I'm going to explain to you how I did it so you can create one too =)
pink). You then simplify the font layer and erase your O. Then right click your rectangle tool and choose custom shape tool. A heart will be your default shape for that. On a new layer, place the heart where the O was
Then use a worn looking brush (or a wet media brush if you don't have any downloaded brushes that would work) to make the edges of the heart fit in with your font, if necessary.
Next you will decorate the blank space to make the picture more interesting. I used a paint splatter brush.
The only thing that's left to do is put your watermark on the picture!
And you're done!
Here is an additional one I made: