Create wrap around letter

Unless I am missing something, you don't actually wrap the text, you just put the text on a layer above the object.

I want to wrap the background around the txt..
can that be done?

this is what I mean....

See how the background wraps around the letter GIJOE on the side, top and bottom...
How can I do that?

That is a border or "Stroke".

You can go to the appearances window or you can see the top bar shows the stroke info as does the left.  The appearances window will give you more choices.    

That is the basics, now making it look like the G.I. Joe sample is left to your own creativity.

Nope, that's not a simple stroke, that's an inner bevel. It's way easier to obtain that effect in Photoshop, but you can simulate it in Illustrator also.
See this tutorial: http://rwillustrator.blogspot.ro/2008/07/technique-emboss-text-effect.html
and this discussion: https://forums.adobe.com/thread/480665

HTH,
Dan

No guy's that is not what I'm going after... look closer to what I'm pointing out.
It's like there is a sq and on the side were the letters are it warps to them and then were the strips are it's not.
Als the top is red and the bottom is blk and see the star, how it also get wraped