You use "usted" is to show respect for elder people or important people or people that you dont know, for example, i want to know the name of my boss i should tell him: ¿Como se llama usted?, but if someone introduce you a person who is "equal" like you (age) you can say: ¿Como te llamas?... I hope this helps you

in spanish you can adress people as "ud" "tu" or "vos" . "Ud" is very formal and polite.

vip or old people

"usted" is used in formal sentences.