Stickers are a big part of design here on Wattpad because people use them as awards for contests. If you do a Google search for 'book award stickers' you'll notice they are, for the most part, round. There are a few that are oval and a square one here or there but I'd say probably about 90% of them are round.
I've noticed a lot of people doing square stickers, which basically ends up looking like an icon. There's no distinction between the sticker and an icon image if it's square. And squares look funky on a book cover.
Just because you put a circle outline on does not make it a sticker. Those users that have won a book contest may not know how to cut it out and make it a circle, like a graphic designer who has won a graphics contest might.
It's much simpler to make it a circle, to begin with, and also a lot less work for the users who were awarded the sticker. I wouldn't even bother with the sticker if it was square. If I can't slap it right on my cover I'm not going to mess with it.
I've also seen people slap the circle outline on the square image and yet, their images and text aren't centered within the circle. It's off to one side or even outside the circle outline which makes it hard to cut it out correctly. Why did you use it if you aren't going to center things properly within the circle? It's just another thing that will make it difficult for a user to cut it out and make it a circle. Again, I'd give up and not use it.
It's very simple to make a circle sticker. We'll use our friend the clipping mask.
You can find yourself a png of a circle or just set your brush to a large size and make a circle.
It really doesn't matter what color it is you can always change it. Make sure it's not fuzzy because if you clip anything to it then it will be fuzzy as well.
For the above sticker, I used two background images
I clipped them both to the circle layer ( If you don't remember how to do the clipping mask go back and re-read the chapter titled Clip it, Clip it Good). Once you have your background image exactly how you want them you can add the text and any image directly onto the sticker. You can clip your added image layers if you want to but it isn't necessary because they'll likely be smaller than the circle so they don't need to conform to the edges of it. When you're done, save the image as a PNG with no background.
It's not magic to make a round sticker.
(for anyone who has noticed that my PNG image backgrounds don't turn gray in the chapters it's because they have a background behind them that appears like the PNG squares. It makes it easier to see that it is a PNG image with no background)