What’s a Data Warehouse? A Quick Guide for Your Marketing Team

James Hart Alight Insights, Marketing Data Management

You don’t have to understand how your marketing analytics solution works to value what it does. Ultimately, results are what matter.

But it can still be useful to know how these tools deliver the insights that drive your marketing campaigns. After all, details matter, too.

If you’re trying to build your knowledge of data-driven marketing, the data warehouse is a good place to start. It’s one of the field’s most fundamental concepts.

A data warehouse is a central repository that lets a business store all its data, even if it comes from a wide range of sources, in a single place.

For marketers, that might encompass the data from your web analytics, PPC campaigns, display ads, social channels, CRM tool and whatever email service provider you use. It could also include the spreadsheets you create to track offline media or out-of-home advertising, or the metadata you collect to bring more context to your campaigns.

Life without a data warehouse? Well, it can be inconvenient and inaccurate.

To produce reports on your campaigns, you would have to download data from all the source systems, then copy and paste information into dozens of Excel spreadsheets. That’s an expensive, time-consuming use of resources. And those “handmade reports” suffer from a higher risk of human error.

At Alight Analytics, marketing analytics is our mission, but companies can use data warehouses for HR records, sales figures, inventory — whatever they need to store and access in a scalable fashion.

How a Data Warehouse Works

While it’s possible to keep your data warehouse on servers in your building, some of the most popular solutions are cloud-based.

Your data warehouse is all about data storage. To get data into the warehouse, you can build tools to pull data from third-party service providers like Google Analytics or import flat files and spreadsheets.

Some warehouses will house “data marts”—separate, smaller collections of data from a specific business unit. Advertising and marketing agencies might create a data mart for each of their analytics clients.

Once your data is in a warehouse, it can be used to create reports and dashboards that clearly illustrate your performance to your clients or your supervisors.

Some data-driven marketers use end-to-end solutions like Domo and Datorama for gathering and reporting their data. These kinds of software tools are designed to be all-in-one solutions, but they may fail to deliver the customized reports that marketers need.

Other marketing teams rely on separate, more specialized tools for each step—a stack of marketing tech. They might employ Alight’s ChannelMix solution to collect, clean and store their data. Then they’ll use Tableau Software for visualizations.

The benefit? These dedicated solutions usually offer greater customization and richer insights. They’re perfect for drilling into the finer details of your campaigns.

What a Data Warehouse Isn’t

A data warehouse is different from a company’s day-to-day, “operational” systems, such as its point-of-sale (POS) software, for example. An operational system’s database is constantly being updated—in the case of your POS, every time a sale is made.

Data warehouses, meanwhile, might be updated daily, weekly or monthly. (For marketing purposes, usually daily.)

Though operational databases and data warehouses are different, they work together. Your operational tools generate the data that’s ultimately stored in your warehouse.

Google Analytics is a powerful tool for measuring your digital marketing … but it’s not a data warehouse solution, either. If you have errors in your data, you can’t really correct them inside Google Analytics. When you add that data to a warehouse, though, the warehouse will subject it to a cleanup process first.

What Are the Benefits of Using a Data Warehouse?

A data warehouse contains a huge amount of historical data collected over months or years.

Because of that perspective, users can more easily compare their latest results with what’s gone before. They can uncover trends they might miss if they looked only at the latest batch of numbers.

If you want to do advanced analytics — that is, use your historical data to make forecasts about what you should do next — you need a huge body of past results to build accurate predictions. Only a data warehouse is big enough to store everything you need.

Another benefit of using a data warehouse? Consistency.

Your marketing information comes from a dizzying number of channels — one enterprise might draw from hundreds of data sources. Unfortunately, each of those sources may have its own method for formatting data.

A data warehouse helps by putting your data, no matter where it was created, into a common format in a single place. That ultimately translates to faster, more accurate insight into your marketing.

Better data leads to better marketing. And your data warehouse plays an essential role in that process.