Residential proxies are used when two things are important: the address should look like a home one, and many addresses are needed — with precise location binding.
Typical tasks
Collecting public data in volumes where requests from one address hit site limits.
Checking search results, ads, and prices as seen by a resident of a specific country, region, or city.
Working with platforms that do not allow data center addresses.
Checking geo-targeting: how a site or ad behaves in different locations.
Tasks where the address should change with each request.
Working across many countries when buying addresses in each is unprofitable.
When to consider another format
Residential proxies are paid for by traffic, so on heavy tasks, consumption grows with the volume downloaded. If this is not your case, there are more predictable options:
If you need the same address for a long time — ISP or IPv4: they are static and paid for by address, not by gigabytes.
If consumption should be predictable regardless of data volume — any static format.
If you need many cheap addresses and site trust is not critical — IPv6.
If you need an address of a specific mobile operator — Mobile.
Detailed comparison — in the article How Residential differs from other proxy formats.