Switching costs are a borrowed power that provides revenue continuity, but they can become a strategic liability if treated as the primary value rather than a consequence of it. The key distinction lies between switching costs from embedded value, which arise from genuine product integration and workflow fit, and engineered inconvenience, which creates fragility. Designing for justified dependence, where customers become reliant due to memory, trust, and coordination, creates a sustainable competitive advantage rather than a trap.
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