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Contracts: Users are sometimes locked into contracts for service, supplying parts, and buying spare parts…. Training and learning: Consumers are trained to use products operating on a specific standard. Switching costs would include learning and training people, as well as lost productivity resulting from adopting a new system. Data conversion: Each piece of software generates files that are saved using a particular digital format. Once a new software is introduced a conversion software may be needed in order to be able to use it. Notice that the resulting switching cost increases over time as the collection of data may grow over time. Search cost: One reason why people do not switch very often is that they would like to avoid the cost of searching and shopping for new products. Loyalty cost: Switching technology may result in losing some benefits such as preferred customers’ programs, for example, frequent-flyer mileage. |