It's the fight of the century. We've got Reverse ETL in the red corner. CDPs in the blue corner. Who will win? Ding ding ding!
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The world of data analytics is rapidly evolving; with it, new technologies and methodologies are emerging. Two technologies that are becoming increasingly popular are Reverse ETL and Customer Data Platforms (CDPs).
While both technologies are designed to improve data management and analysis, they differ in their approach and capabilities. In this article, we will explore what Reverse ETL and CDPs are, how they differ, and which is best suited for different use cases.
Looking for the down low from a download? Want to be overly-informed on CDPs? Well, check out our Customer Data Platform (CDP) Buyer Guide eBook, here!
What is Reverse ETL?
Reverse ETL stands for "Extract, Transform, Load," but in reverse. Unlike traditional ETL, which extracts data from various sources, transforms it into a structured format, and loads it into a data warehouse or other destination, Reverse ETL takes data from a destination and syncs it back to the source systems.
Reverse ETL is a newer technology that is designed to solve the problem of data silos. In most organisations, data is generated and stored in various systems, such as CRMs, ERPs, and marketing automation tools. These systems typically have their own databases and do not communicate with each other. As a result, data is often fragmented and scattered across multiple sources, making it difficult to get a holistic view of the business.
Reverse ETL addresses this problem by syncing data from the destination back to the source systems. This way, all data is kept up to date and in sync across all systems. Reverse ETL solutions typically offer pre-built connectors to common data destinations, such as data warehouses, BI tools, and marketing automation tools, making it easy to set up and maintain.
What is a Customer Data Platform (CDP)?
A Customer Data Platform (CDP) is a type of software that collects and manages customer data from various sources, such as websites, mobile apps, social media, and customer service channels. A CDP is designed to create a unified customer profile that can be used for various marketing and analytics purposes.
CDPs differ from traditional customer databases in several ways. First, they are designed to handle large volumes of data from various sources and integrate them into a single profile.
Second, they offer advanced segmentation and targeting capabilities, allowing marketers to create personalized campaigns based on customer behaviour and preferences. Finally, CDPs are built with data privacy and compliance in mind, ensuring that customer data is handled in a secure and transparent manner.
CDPs typically offer a range of features, such as data ingestion, data cleansing, data deduplication, identity resolution, segmentation, and activation. They also integrate with various marketing and analytics tools, such as email marketing platforms, ad networks, and customer analytics tools.
How do Reverse ETL and CDPs differ?
Reverse ETL and CDPs are both designed to improve data management and analysis, but they differ in their approach and capabilities.
Reverse ETL is focused on syncing data from the destination back to the source systems, while CDPs are focused on collecting and managing customer data from various sources.
Reverse ETL is ideal for organizations with data scattered across various systems and needs to keep it in sync. For example, an organization that uses a marketing automation tool, a CRM, and a data warehouse may use Reverse ETL to ensure that all data is up to date and in sync across all systems.
CDPs, on the other hand, are ideal for organisations that want to create a unified customer profile and use it for various marketing and analytics purposes.
For example, an e-commerce company that collects customer data from various sources, such as its website, mobile app, and social media channels, may use a CDP to create a single view of the customer and use it to personalise its marketing campaigns.
Now let's look at some companies using one or the other.
Companies Using Reverse ETL or CDP
Reverse ETL:
- Hightouch: Hightouch is a data integration platform that offers a Reverse ETL solution. The company's platform provides pre-built connectors to various data destinations, such as CRMs, marketing automation tools, and customer data platforms. Hightouch's Reverse ETL solution helps organizations sync their customer data across various systems and create a unified view of the customer.
CDPs:
- Segment: Segment is a customer data platform that collects and manages customer data from various sources, such as websites, mobile apps, and customer service channels. The company's platform offers a range of features, such as data ingestion, data cleansing, identity resolution, and segmentation. Segment's CDP is used by companies like IBM, Airbnb, and Lyft to create a unified view of the customer and personalize their marketing campaigns.
- BlueConic: BlueConic is a customer data platform that collects and manages customer data from various sources, such as websites, mobile apps, and CRM systems. The company's platform offers a range of features, such as data cleansing, identity resolution, segmentation, and activation. BlueConic's CDP is used by companies like T-Mobile, Hearst, and ING to create a unified view of the customer and improve their marketing and customer engagement efforts.
Which One Should You Choose?
When it comes to choosing between Reverse ETL and CDPs, it's important to consider your company's specific needs and goals. Both technologies have their own strengths and weaknesses, so it's important to evaluate them based on your unique business requirements.
If your primary goal is to keep your data in sync and up to date across various systems, then Reverse ETL may be the better option. Reverse ETL is ideal for organisations with data scattered across various systems and needs to keep it in sync. With Reverse ETL, you can ensure that all your data is up to date and in sync across all systems, which can help you make more informed business decisions.
On the other hand, if your primary goal is to create a unified view of the customer and use it for various marketing and analytics purposes, then a CDP may be the better option. CDPs are ideal for organisations that want to collect and manage customer data from various sources, such as websites, mobile apps, and social media channels. With a CDP, you can create a single view of the customer and use it to personalise your marketing campaigns and improve your customer engagement efforts.
Ultimately, the decision to choose between Reverse ETL and CDPs depends on your company's specific needs and goals. It's important to evaluate each technology based on its capabilities and how well it aligns with your business requirements. You may also consider working with a data expert or consultant to help you choose the best option for your organisation.
Looking for the down low from a download? Want to be overly-informed on CDPs? Well, check out our Customer Data Platform (CDP) Buyer Guide eBook, here!