What You’re Really Asking
This question addresses temporal lock-in—whether switching costs increase the longer the customer uses the product.
The most powerful moats are those that deepen automatically. The best Ceiling companies become more entrenched with every passing quarter, not less.
The Compounding Test
Ask: Is a customer who has used this product for 5 years more locked-in than a customer who has used it for 1 year?
- If the answer is meaningfully yes—not just because of habit, but because of accumulated value that would be lost—data gravity compounds
- If the answer is roughly the same—the 5-year customer could switch about as easily as the 1-year customer—data gravity is static
Ceiling Indicators
- Historical queries are valuable—users frequently access and analyze old data
- ML models improve with usage—making the product smarter, more accurate, more personalized over time
- Users build on accumulated data—reports, dashboards, and workflows referencing historical information
- Year-over-year comparisons matter—the business needs longitudinal data
- Customers cite history as a switching barrier—”all our history is here”
Floor Indicators
- The current state matters most—historical data has limited analytical value
- Data is transactional, not cumulative—once a transaction is complete, the record has limited future value
- Exporting captures full value—exporting data to a new system loses nothing meaningful
- Product value is in the doing, not the record—benefit comes from using the tool, not from what’s stored
- Customers don’t mention history—switching discussions focus on features rather than data
The Verdict
NO → Floor only. The company cannot build deepening lock-in over time.
YES → Ceiling possible. The company’s moat strengthens automatically with customer tenure.
This is part of a comprehensive analysis. Read the full analysis on The Business Engineer.
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