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Lock-in 27#
Customers are locked into a vendor's world of products and services. Using another vendor is impossible without incurring substantial switching costs, and thus protecting the company from losing customers. This lock-in is either generated by technological mechanisms or substantial interdependencies of products or services.
Apply this pattern to your own business and create your next innovative business model!
Examples: Iconic Cases
How they do it: The more files customers have saved on their Dropbox’ file hosting space and the more devices are linked to it or the more users the space is shared with, the more effort it is to switch to another service.
Learn more about Dropbox →
How they do it: Through their Google Playstore, the company offers both content and apps for its customers. However, these can only be used on the respective environments and not be transferred to other environments. Hence, once the customer is used to the service and has purchased a lot of content or apps, the switching costs are very high.
Learn more about Google →
How they do it: In the beginning customers set up their initial cloud computing structure on AWS by using the free ”credits”. With an increased use of the product, the switching cost to a different solution increase as well.
Learn more about Amazon Web Services →
How they do it: Hewlett-Packard’s printers have only limited compability with 3rd party ink cartridges, leading to a lock-in effect for customers once they purchased a Hewlett-Packard printer device.
Learn more about Hewlett-Packard →
How they do it: Apple has created an ecosystem of hardware and software combinations. For example can the native music app of the iPhone only be connected through the Apple software iTunes. This creates a lock-in effect, also when the user wants to synchronize other media across devices.
Learn more about Apple iPhone/AppStore →
Below, the top industries for the pattern "Lock-in" are displayed, in order to get insights into how this pattern is applied across different industries. We've collected data from 15 firms using this pattern.
Top Industries
Information Technology
18% of firms using pattern
18% of firms using pattern
Services
15% of firms using pattern
15% of firms using pattern
Consumer Goods
14% of firms using pattern
14% of firms using pattern
All Industries
Below, the pattern "Lock-in" is analyzed based on co-occurrence, in order to get insights into how this business model pattern is applied in combination with other patterns within the firms we studied.
Top Co-Occurrences
Two-sided Market
4 pattern co-occurrences
4 pattern co-occurrences
Digitization
4 pattern co-occurrences
4 pattern co-occurrences
Leverage Customer Data
4 pattern co-occurrences
4 pattern co-occurrences