Color categories are a great way to get organized. Color adds visibility to your Outlook items so you can sort and find what you need.
To assign a color category, do the following:
The first time that you assign a default color category to an item, you'll be prompted to rename the category. You can also change the color of the category and choose a keyboard shortcut.
For the most current and detailed information on creating and assigning color categories, please reference the Microsoft support page here.