I love using sticky notes to teach vocabulary. Kids love them too and it's amazing how a little sticky note can grab their attention.
When should you do this? For me, an interactive read aloud is the perfect time to throw in some quick vocabulary lessons. I used to plan it out, but this activity is so easy that once you do it a few times you can grab a word on the fly.
The only thing you really need to do prior to the activity is make a Vocabulary Chart, as described below. Also, be sure you always have sticky notes and a pen by your side (I keep a variety of notes and pens because the kids love to use them to add to the chart during their reading time).
For example, today we were reading about penguins and we came across the word sleek which described the outer layer of penguins feathers (we also hit "downy" for the underlayer).
We acted it out to target the kinesthetic learning style that many students have, then added it to the paper labeled "Adjectives," because that is how it was used in the story.
All of this only takes a minute or two: keeping it short so as not to disrupt the actual read aloud too much is key to keeping their attention.
Later the children can take the sticky notes off the paper to use in their writing when they need to. We also use them for word sorts according to different characteristics and to build bigger words (sleeker, sleekest).