Yes, you can create a new label if you are not keen to use the default labels. Click on the ‘Contacts’ tab at the sidebar menu.
The dialog box will pop-up and click on the label category. A list of different labels will appear. Scroll until the bottom of the list and click on the ‘Add Label.'
Fill in the label name and select the color that you preferred. Lastly, click on the ‘Save’ button to create a new label for your contacts.