you have two things mixed together here.  Do you want to mark them Private
or place them in a Category?

Either way you can do it like this:

View the Contacts folder in Phone List view.
Turn on the Field Chooser (it's on the Advanced Toolbar).
Drag the column header (field name) you want to group by into the Group By
Box. eg Private or Categories.
Drag Contacts from the None group to the Private group.

I hope this helps you at least a little bit!

Judy Gleeson
MVP Outlook
Outlook trainer and author of Productiv_IT with Outlook

read my articles here: www.judygleeson.com
www.acorntraining.com.au
Canberra, Australia

Joseph Joubert
To teach is to learn twice.