Here are some things you can do with your towel:
carry small stuff
drag bigger stuff
drape it over stuff too big to drag
wrap it around your head
detain people with contraband
hide your shame
shame your hide
somewhere to put sand when you are at the beach
emergency coffee filter
makeshift bra and loin cloth combo
hands-on science museum speed of sound demonstration
And if you run out of ideas, you can use it to lay on in a field at night, stare up at the stars and thank Douglas Adams for making the Universe a much better place to be insignificant in.
Please feel free to add your own towel ideas in the comments.