Masking your IP address might be useful in a range of situations from accessing blocked content to bypassing anti-bot systems implemented by search engines and other online services. Here are several ways of organizing proxies:

  • Residential proxy – IP addresses that are assigned to homeowners by the ISP are called residential. These addresses are flagged in regional internet registries. Residential proxies use such IP addresses because all requests that are sent via them are indistinguishable from those generated by regular users.
  • Data center proxy – Such proxies are not connected to the ISP, while addresses are assigned by hosting providers who've purchased large pools of IP addresses.
  • Shared proxy – In this case a proxy can be used by several users at one time. Such proxies can be  data center-based, but ISPs are also providing this technology to their users.
  • Dedicated proxies – Private proxies that can be accessed only by one user are called dedicated. One can purchase such a proxy from specialized services, hosting providers, ISPs or VPN operators.

All these options have their pros and cons, but companies are more and more often sticking to residential proxies. The main reason is that such proxies provide real IP addresses from ISPs from different locations (countries, states/regions, and cities). As a result, when you are establishing a connection to a party, it looks like the real person is trying to reach out. No website or other online service will ever try to block a request sent by a potential user and buyer.

Using a residential proxy leads to a lot of opportunities for companies. Let's talk about real business-related use cases for residential proxies.

Why do businesses need a proxy

According to data from Distil Network, a bot-fighting company, nowadays, up to 40% of all web traffic on the internet is not generated by humans.

An important fact: not all bots are "good", like search engines crawlers. There a lot of bots which are used to gather information or competitive intelligence, and many businesses are trying to block such bots.

By 2017, of that overall 40% of bot-based traffic, around 21.80% were bots considered "bad". And site owners were trying to ban them.

So, why may a company want to bypass such a block implied by another company?

Gathering real information from competitors’ websites

One of the most famous residential proxy use cases is competitive intelligence. Today it is straightforward to track data center proxies and block requests generated via such tools. Many popular online services like Amazon, Netflix or Hulu, are blocking entire ranges of IP addresses that belong to particular providers.

However, in the case of a residential proxy, any request looks like one sent by a real person. So, if there is a need for sending numerous requests, residential proxies allow sending them from different IP addresses from any country and city, as well as local ISPs.

Brand protection

Another practical implication of residential proxy technology is brand protection and fighting counterfeiters. For example, drug manufacturers of, say, Viagra, might want to fight sellers of fake generic alternatives.

Usually, such sellers restrict access to their website from countries where the real manufacturer's offices are located. This makes it harder to identify and use legal action against counterfeiters. Residential proxies can be used to get an IP address from the same country the counterfeit website resides, and gather all the necessary data.

Software testing and performance monitoring

Residential proxies are also suitable for testing new features for websites and mobile apps. Developers can see how their software works for users from different locations. Also, sending numerous requests using multiple residential IP addresses is helpful in testing the behavior of the software in a case of high load.

Moreover, this technology is useful for performance monitoring. Global companies want to understand how fast their website is for users from a particular country. That is why using residential proxies IP addresses helps to gain relevant information.

Marketing and advertising optimization

It is crucial to test ad campaigns to ensure a maximum outcome. Residential proxies can be used to see how particular online ads look, for example, in search results for users from a specific location, and whether in fact that they are displayed or not.

Also, using residential proxies helps to assess the effectiveness of local search engine optimization efforts: whether the website hits the top of the rankings for targeted search queries or not, how its ranking changes over the time, etc.

Search engines do not like it when someone collects data using their infrastructure. This is why such companies are continually developing their anti-bot systems, making it very hard to gather data directly from the search.

However, if we use residential proxies to send multiple search requests, it looks like real people in different locations searching for something. Search engines do not block real users. As so, the residential proxy is excellent for guaranteed data retrieval from search engines.

Residential proxies are also perfect for tracking competitors’ marketing activities and analyzing their effectiveness. This technology is used both by in-house marketing teams, and external marketing and advertising agencies.

Content aggregation

In the age of Big Data, a lot of businesses are built on the aggregation of information from multiple sources and displaying the combined view on their platforms. Such services have to use residential proxies to maintain their databases of the aggregated content. Without this tool, it would be tough to keep the data on, say, prices for a particular type of good in different e-commerce websites, up to date. Such sites are banning these activities at the risk of the company's requests being too high.

For example, to create a regularly updated comparison table with prices of vacuum cleaners on 20 different websites, you will need a bot which visits corresponding pages and refreshes them. Anti-bot systems will likely block such requests, but using a residential proxy will help in bypassing such data protection mechanisms.

On-demand data collection and analysis

In the past few years, we've seen an active development of companies that are professionally engaged in on-demand data collection and analysis. Services like PromptCloud develop software crawlers that navigate the web to collect information suitable to predefined profiles. This data is then used for marketing, sales, or competitive intelligence purposes.

Such crawlers often face blocks and anti-spam filters, and residential proxies allow them to solve their tasks successfully.

Savings on using local discounts

Companies can use residential IPs to unlock savings opportunities. For example, lots of airplane and hotel booking websites display promotions based on geographical location. Residential proxies can be used to see and activate such discounts which result in potential savings.

Final thoughts

The ability to simulate requests from real users with an actual, local IP address can be beneficial for businesses. Companies often use this technology for data collection, tests, accessing different web resources, and so on.