It's especially useful for doing things during the Origin Request phase, which happens prior to the request from the CDN to the Origin.

In that phase you can change anything about the request itself, or the origin it will connect to. But the function only needs to run when there's a cache miss.

I have an application that needs to select an origin based on the request path (too many to use CloudFront cache behaviours), with a cache miss rate of less than 1%. It's a tiny amount of additional latency for cache misses, and a very small proportion of our CDN costs per month.