Data Warehousing for Dummies Series: An ETL Pimer for Business

Posted: July 21, 2023

ETL is a funny word. Back, when ETL was all I did, my team didn't even call it that. Mostly because we used Excel. I was self conscious about my lack of experience with SQL. I would say, “I move data from one place to another.” And that would get a laugh.

It was a very manual process which I ultimately automated with Python. Most of it. From that experience I gained a deep understanding of data and how it connects together.

What’s funny is that what we call ETL today isn’t ETL either. But the name has stuck. And we all know what we mean by it. But if you don’t know, it’s hard to know.

Ya know?

If you are reading this you already know the value of timely decisions and pivoting on the data. But the task of consolidating and analyzing data from various sources is daunting. There are a lot of moving parts. The first is getting the data. In this blog post, I am going to break down ETL; how data gets from out there into your data warehouse.

Who this is for

You are a business owner or leader:

Data is the new currency of business. When you invest in a data warehouse you need to fill it. ELT tools help you do that. These tools leverage automation. Use them.

You likely don’t want the detail I am about to go into. I created my data warehousing for dummies PDF with you in mind. There are two parts, the first is the executive summary and it is written with you in mind. You can get that here.

You are a data analyst, data scientist, but new to data warehousing:

You are looking for a place to get started. There are two parts to my data warehousing for dummies PDF. The second part is a deep dive into data warehousing. While it’s deep it’s still short. It’s a jumping off point.

This post is part of that deep dive.

Understanding ETL:

ETL, or Extract, Transform, Load, is a process that enables businesses to gather data from different sources, convert it into a unified format, and load it into a centralized database for further modeling, analysis and reporting. You will also hear it referred to as ELT. The processes are very similar only signifying a change in the order of operations because the relative cost of storage has gone down significantly over time. ELT / ETL / EL-T it’s all about getting data into the warehouse.

Let's break it down step by step:

Extract: The extraction phase involves pulling data from various channels such as Google Analytics, YouTube, social media platforms, paid traffic sources, eCommerce platforms, etc. Think of it as gathering puzzle pieces from different boxes.

Transform: Once the data is extracted, it needs to be transformed into a standardized format. This includes cleaning the data, removing duplicates, and ensuring consistency. To learn more about the transformation step, check out this comprehensive guide to the best ETL tools.

Load: After the data has been extracted and transformed, it is loaded into a central database or data warehouse where it can be accessed and analyzed. This step is crucial for creating a single source of truth for your data.

In practice, these last two steps are flipped, leading to the acronym ELT. The terms are used interchangeably. With modern tools the extract and load activities have been replaced by automated data pipelines. These pipelines abstract the minutia of the process. So often engineers will refer to ELT anytime they are talking about data ingestion.

Benefits of ETL tools for Business:

When you buy a data warehouse you need to fill it. ETL tools help you do that. Good tools don’t cost, they pay. A good tool reduces the number of engineers you need to hire to manage your warehouse. Why bother? There are numerous benefits for businesses. Here are some key advantages:

Holistic view of marketing data: Consolidate data from various sources, giving you a comprehensive view of your marketing efforts. By bringing all the pieces of the puzzle together, you gain valuable insights for informed decision-making.

Optimization of marketing strategies: With ETL, you can analyze and understand the impact of your marketing campaigns across different channels. This empowers you to optimize your strategies, allocate resources more effectively, and drive better results.

Process automation. A hidden benefit is automating manual tasks and processes, offering automation and increased efficiency. By centralizing data, syncing it to destinations that usually require manual intervention, and pushing it into downstream business processes, ETL pipelines provide value through process automation. Manual processes consume resources, while ETL pipelines automate the flow of information. This automation helps companies reduce operational costs, improve their bottom line, and establish a scalable foundation for innovation.

Product development. By leveraging existing data assets, ETL enables companies to create innovative offerings and generate new revenue streams. This approach applies to various industries, including e-commerce, finance, and healthcare, empowering businesses to provide value to customers and maintain a competitive edge. Product development is a crucial process that transforms raw data into valuable products. It integrates data from multiple sources and loads it into a target system, facilitating the quick development and release of new products, services, or features.

For a deep dive into ETL tools check out this comprehensive guide to the best ETL tools.

Addressing Concerns and Practical Tips for Data Governance:

Implementing ETL may raise concerns about cost, complexity, and potential disruptions. However, with careful planning and execution, these concerns can be mitigated. Here are a few tips:

Start with a budget-friendly solution: Many ETL tools offer flexible pricing options, allowing you to scale as your business grows. Additionally, some open-source options can help reduce costs without compromising functionality.

Seek professional guidance: If you feel overwhelmed, consider partnering with an experienced consultant.

Getting Started with ETL:

First and foremost, there are tools that automate this. Use them.

Start small: Begin with a focused project, such as marketing, and select a few key data sources that are most critical to your business. This approach allows you to get hands-on experience and build confidence while you learn.

Define data transformation rules: We can’t control how we receive the data. For example, we can’t control the column labels. We can rename them so the names are more informative. Consider factors like data formats, unit conversions, and standardizing naming conventions. These rules will ensure consistency and accuracy in your analyses.

Choose the right ETL tools or platforms: Evaluate different ETL tools and platforms to find the one that best suits your business needs and technical capabilities. This comprehensive guide, ‘Top 100 ETL Tools List & Software: NEW (July 2023 Update)’ , can help you make an informed decision.

TLDR:

Data is the new currency of business. When you invest in a data warehouse you need to fill it. ELT tools help you do that. What you choose to start with matters. You have the power to unlock the potential of your marketing data. Streamline your processes, gain valuable insights, and unlock opportunities for automation. Start small, choose the right tool, and gradually expand your scope.