To convince a CEO of a brand's value, ask one simple question: 'Do we have pricing power?' This metric—the ability to raise prices at or above inflation without losing demand—cuts through marketing jargon. It is the most direct, tangible indicator of brand health that resonates with finance-focused leadership.

In an era of opaque AI models, traditional contractual lock-ins are failing. The new retention moat is trust, which requires radical transparency about data sources, AI methodologies, and performance limitations. Customers will not pay long-term for "black box" risks they cannot understand or mitigate.

For subscription services, the most effective moat isn't the software itself, which can be replicated, but the accumulated user data. Users are reluctant to switch apps because they would lose years of personal history, stats, and community connections, creating strong lock-in.

As AI model performance converges, the key differentiator will become memory. The accumulated context and personal data a model has on a user creates a high switching cost, making it too painful to move to a competitor even for temporarily superior features.

Martin Shkreli posits that Bloomberg's dominance stems from its exclusive messaging system, a critical social feature for Wall Street's relationship-driven culture. Competitors focused solely on data, missing the obvious social component that fosters user lock-in.

A service business's ability to consistently raise its prices is the single best indicator of its operational health. High pricing power signifies that the business has solved its core challenge of talent acquisition and training, creating more demand than it can supply.

Shkreli explains that Bloomberg's single, high price point creates a trap. They cannot launch resource-intensive features, like on-demand AI analysis, because it would disrupt the "all-you-can-eat" model and require a separate, costly add-on that alienates existing customers.

Pricing power allows a brand to raise prices without losing customers, effectively fighting the economic principle that demand falls as price rises. This is achieved by creating a brand perception so strong that consumers believe there is no viable substitute.

Many subscription companies employ a "penetration strategy," pricing below cost to attract a large user base. Once loyalty is established, they leverage their pricing power to increase profits, shifting focus from pure growth to appeasing shareholders who now demand profitability.