Switching costs

The money, time, effort or risk a customer faces when moving from one product or supplier to another.

Example

Years of records held in accounting software that would need to be migrated.

High switching costs protect revenue but can attract resentment if abused.

Moat — A durable competitive advantage that protects a business from rivals.
Network effect — The property of a product becoming more valuable to each user as more people use it.

The real competitor is often a spreadsheet or doing nothing — Competitive diligence maps every alternative a customer could choose, including internal tools and inaction, and uses win and loss data to see where the company actually wins. (10 min)
A moat is what stops a competitor copying your success — Competitive advantages come from switching costs, network effects, proprietary data, brand, scale and distribution. Network effects are especially powerful, and especially often claimed without evidence. (11 min)