I thought I understood it well. But I was trying to explain the concept to someone else and my explanation made NO sense. Lol.
Here's the example I used... A site gets 50 NEW members per month @ $20 each and has an amazing rebill ratio of 50%. This is the formula I came up with...
JANUARY.....................................50x $20 = $1000
FEBRUARY...............(rebills)25x$20 + 50x$20 = $1500
MARCH...................(rebills)37x$20 + 50x$20 = $1740
APRIL.....................(rebills)43x$20 + 50x$20 = $1860
MAY.......................(rebills)46x$20 + 50x$20 = $1920
Total members 401....................................$8020
Now I know there is something wrong with my formula because you can never get over 50 members rebilling per month. And the percentage increase just gets less and less each month.
Can someone explain this to me using my above example as a reference? I feel like a dumbass.
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