changing Categories - converting Contacts to other categori

changing Categories - converting Contacts to other categori

Hello: I am just learning how to use Zoho CRM. It is my understanding that you can convert a Lead to either New Account or Contact. If you lose a customer, is there a way to convert that contact to Former Customer? I see that you can customize the Tabs by renaming. Basically I would like to be able to move a customer from Active to Cancel? Is the best way to just Rename the Tabs or is there a better method?
Can you change a contact or account to another Tab? Thank you :)