I use it for the following:

• Micropayments: I give people 0.01-0.10BTC all the time for stuff.
• Online Goods: Whole lot easier than dealing with Paypal. This also makes a great universal currency.
• Donating to Wikileaks and the FSF (and previously EFF).

I really like the speed and ease at which I can make international payments. And I don't feel bad about giving someone a small amount of Bitcoins.  If I try to send someone 0.01USD Paypal would eat it with fees, but sending someone the equivalent in Bitcoin is simple and easy.