One of the fields you can use to classify your database contacts is Contact Category. By default, there are several Contact Categories from which you can choose. If you would like to designate a Contact Category not available from those default categories, however, you have the ability to add new Contact Categories.
To do so, under your Manage Your Account menu, select Manage Database Lists:
The body of the Manage Database Lists page contains all of the lists that you can edit in expanded form. You can work with individual database lists by clicking their name in the Lists box to the right:
After you've clicked Contact Category List, your page will refresh displaying only this list:
Note that beneath some of the Contact Categories displayed here, e.g. Personal Client, that these are system Contact Categories and cannot be edited or removed. You can, however, add new Contact Categories by clicking the Add button in the top right corner. You'll then see the below dialog:
Just type in the name for your new Contact Category and click Save Contact Category. If you had added a new Category named "Hot Prospect", you would then see it in your list of Contact Categories, as below:
As you can see, those Contact Categories that have been manually added to your database have both Edit and Delete options beneath them, meaning you can edit their name or delete them entirely.
After adding your Contact Category, it will then be available in the menu when editing a contact's Category.