This gets your tree up off the floor for easier watering (if real) and makes more room for gifts underneath. Also brings the eyes up for more enjoyment of the decorations. I can see building the bottom level wider and putting a cute fence around the tree to keep kids out of the tree or from pulling it over.
http://www.diylife.com/2008/08/13/how-to-build-a-christmas-tree-pedestal/
http://www.diylife.com/2008/08/13/how-to-build-a-christmas-tree-pedestal/