Understand Your Buyer > How To Convert > Residual Value

 

What is it?

Also known as depreciation, the amount of money something is worth will decrease over time naturally. The higher the residual value of something, the more attractive it is to buy as you “lose” less money.

 

Why does it work?

It works because when it comes to making a buying decision, we want to take the safest route and be sure that we are getting the best deal possible. If we know that the car we are buying or piece of equipment we are buying won’t “lose” lots of value and will be resalable, then it makes it a more attractive buying proposition.

 

How can you use it?

 

Example

The car industry uses residual value to help buyers make the right decision:

 

See also

• The Long Lasting Effect
• Payback time