Archaeologists determine what an artifact was used for by

Archaeology is the study of cultures that lived in the past. It is a subfield of anthropology, the study of human cultures ... Archaeologists look for patterns in the artifacts they study that give them clues about how the people who made and used them lived.

In an excavation archaeologists must indentify and classify every object or material found by a direct analysis trying to figure out its functionality, the chronolgy (approximated time of the artifact), typology (culture, social and artistic aspects noticed in it) and the origin of the material in which the artifact was made (if it's posible). After this the archaeologist must write it down the collected information in an inventory sheet to deliver the artifacts to the laboratory for a better investigation in which matters to its chemical composition.