1. Start with a bark image and a wood image.
Name this layer “Bark”
Name this layer “Wood”
2. Find a font that gives the scratchy effect you would like or you can just draw one with the brush tool or draw the shape you need. Heres a link of the one i used http://www.dafont.com/the-hand-of-tes.font?text=TREE
3. Next rasterize your typed layer, then press CTRL and click on the typed layer. This will select the outline of the letters
4. Now select the “Wood” layer and click on the layer mask icon. (circle in square)
5. To add more depth right click on the the word you typed layer, right click and select blending options. Under advanced blending turn the fill down to 0% and add inner shadow.
In the Inner Shadow option select:
For the shadow color select a dark of the bark you have.
The key here is how much highlighting and shadows you use to give it more of a realistic effect. I hope you get the idea from my quick example. Also, you can use the layer mask to your advantage to make it more scratchy just select the mask and use a black brush to erase and white to add. This way you have more control over how you want it to look with out messing it up with the erasing too. Good luck :-)