If you keep a lot of appointments and meetings on your Outlook calendar, adding color categories lets you scan and visually associate similar items. You might assign all personal items to the green category and all important items to the red category
Note Categories don't work for calendars in an IMAP account.
To see more categories or to create a category, click All Categories to open the Color Categories dialog box. To assign a color category from the Color Categories dialog box, you must select the check box next to the color category. The Color Categories dialog box is also a quick way to assign multiple categories to an item.
The first time that you assign a default color category to an item, you'll be prompted to rename the category. At this time, you can also change the color of the category and choose a keyboard shortcut.
When you assign a color category, that color is used as the item's background color on the calendar grid.
Tip You can change the name of any category. Click an appointment, meeting, email message, or contact, and then click Categorize > All Categories. Click a category, and then click Rename.