Lavender is such a sweet wonder! If you have just the flower buds simply put them in a small open container, basket, jar or ... whatever. I have made small little "pillows" out of any thin airy fabric and tuck them in drawers and give them as gifts. I also put my little "pillows" in my storage bins of fabric to keep them fresh.
If you have fresh lavender, with the stems, bunch them with ribbons and hang them in closets, weave the stems and tie off with ribbon or thread or form the long stems into wreaths. A quick internet search will give you many ideas on ways to use lavender.
I have made my own soap with the lavender flowers generously added. You can use the stems also but it is not as pretty.
http://www.joys-of-lavender.com/lavender-crafts.html
http://everything-lavender.com/lavender-crafts.html
My favorite lavender craft was a tooth pillow for my daughter at about age 5. She is still my lavender girl at thirty something.
But the best use of all is tucking just a little lavender "pillow" in your linen closet to scent your bedding or your bed pillow and you will relax and sleep peacefully. Yes, it really helps. Not a cure all for restless sleep but it sure does help.
A little in your sewing room will be relaxing too.
Any one tried Lavender ice cream or lavender cookies? YUM-YUM!