change barriers

Change barriers are obstacles that customers perceive to make the switching of suppliers more difficult. Change barriers are thus an instrument of customer retention within customer relationship management.

A distinction can be made between technical-functional (e.g. incompatibility of one’s own products with competing products, as in the case of Apple), economic (e.g. specific investments in B2B, so switching to competing products would be associated with high costs) and contractual (e.g. long-term contracts, as in the case of mobile phone providers) barriers to switching.

The challenge with change barriers is to make them as positive as possible for the customer (e.g. loyalty points). Negatively designed change barriers are likely to lead to customer dissatisfaction and migration as soon as technical or legal conditions change or new competitors enter the market.