Reverse ETL vs. CDP: Key Differences & What’s Best for Businesses?

Reverse ETL aims to simplify and optimize business data, while CDP only focuses on customer data. There are cases where companies use both tools, but it’s not a real necessity. Which data management option is right for you depends on your business needs, tech stack, use cases, engineering resources, etc.

For example, an e-commerce company might use both tools – CDP to collect and unify customer data from various sources, such as websites, mobile apps, and CRM systems. Plus, reverse ETL helps the company extract relevant customer data from the CDP and load it back into its operational systems (inventory management and customer support systems).

What is Reverse ETL?

Put simply, reverse ETL draws data from a central data warehouse and pushes it back to the source location or other places that require it. At the same time, it allows an organization to apply immediate benefits that derive from data interpretation.

Personalization and pushing customer data back from a data warehouse to the marketing or sales platform via REPL is of great importance with regard to delivering personalized messaging or recommendations. The reverse ETL may also help support operational decision-making by ensuring the current relevant data is provided to relevant internal systems like stock management and customer care.

Use Cases of Reverse ETL

Thanks to its functions, reverse ETL is the perfect data pipeline for organizations handling large amounts of data ripe for analytics. Companies and businesses that run on advanced data stacking and analytics can make the most use of reverse ETL. Some use cases of reverse ETL include the following:

• Improving marketing tactics and campaigns
• Optimizing product process by sending user metrics
• Increasing sales
• Boosting customer success

What is CDP?

Customer data platforms are mechanisms by which companies gather, organize, and apply information relating to their customers. Imagine it as a core that collects data from various points, including clicks on websites, making purchases, contacts with customer support, etc.

Unified customer profiles will give them an overall understanding of what their customers do and like and interact with them all over different points. Through this, they can understand their target audience well and offer custom-made services or products.

Consider an e-commerce firm with various commodities sold on the web. Its website, mobile apps, and emails, as well as other online activities. Here, the CDP assists the e-commerce business in gathering customer information, developing uniform profiles, grouping clients, tailoring personalized advice, and enhancing marketing initiatives.

Use Cases of CDP

Customer data platforms are the best pick for companies and organizations striving to boost their digital marketing game and advertising options by gathering customer intel. Some use cases of CDP include:

• Retail
• Digital Marketing
• Data integration & management
• Online/offline customer profile creation

Key Differences Between Reverse ETL and CDP

Even though these customer data methodologies are not mutually exclusive, their differences make them suitable options for specific customer-related data. Both reverse ETL and CDP tend to customer data but through different aspects. In the table below, we’ve outlined the main disparities between reverse ETL vs. CDP.

Do Companies Use Both Reverse ETL and CDP?

In essence, yes, companies can and use both tools to achieve different results. In general, these technologies cater to different business needs. Reverse ETL and CDP come with distinct functionalities and aim to fulfill different goals. For instance, you can use reverse ETL to focus on business data and CDP to monitor customer data. 

However, the two functioning together is not a necessity. Using only one is enough as long as you understand your business needs, when the two technologies should be used, which teams should use the methodologies, and so on. 

To paint a better picture, let’s assume you’re considering using reverse ETL. If you don’t have a team of engineers on board, you won’t make much use of the technology since reverse ETL requires professional knowledge. On the other hand, if you’re considering CDP, you probably operate on customer data that needs further categorization and cleansing to deliver personalized customer views and marketing opportunities across multiple channels.

For example, an e-commerce company might use both tools – CDP to collect and unify customer data from various sources, such as websites, mobile apps, and CRM systems. Plus, reverse ETL helps the company extract relevant customer data from the CDP and load it back into its operational systems (inventory management and customer support systems).

What to Choose? 

Before you make the final decision on whether to choose CDP or reverse ETL for your business, you need to understand your business’s goals and needs. Both of these approaches have their ups and downs, so it’s vital that you assess their benefits guided by your business preferences.

If your business could benefit from data being always in sync across channels and systems, then reverse ETL might trump CDP. Alternatively, if your business success relies on retaining customer data to better the marketing and analytics options, then CDP is the way to go.

Ultimately, rather than contemplating CDP vs. reverse ETL, outline your business’s needs and see what you’re trying to achieve. Are you looking to understand customer behavior better and use the data to enhance your marketing tactics? Or would your company benefit by using unified, structured data that’s easily accessible for further analysis? 

The answers you reach will help you make a solid business decision that will lead you to more business success. 

How Rivery Can Help

In the vast world of data analysis and management, a wrong choice can easily break a positive track record in a second. Rivery is the place of professionals, experienced data-driven experts, and data enthusiasts who can pinpoint your business’s needs.

As a comprehensive data-integration platform, Rivery has partnered up with many businesses to streamline their data processes and optimize their performance. For instance, Tomer Coreanu, VP & General Manager at Tomorrow.io, shared his experience with Rivery. Tomorrow.io chose Rivery to be its all-in-one tool for data manipulations and schema translations, besides being the robust tool that manages data throughout different stages of data processes. For the company, Rivery stood as a logical solution that offered simplicity, customization, and flexibility.

While Rivery focuses on data management, you will have the time to focus on your business. Whether you are looking for comprehensive data stack solutions, data orchestration services, or DataOps management, Rivery can help.

Contact us and try the comprehensive SaaS platform to solve all your data problems. Turn plain numbers into actionable data and see your business’s success reach a new high!