What would be a compelling Business case for one to go for a traditional PIM product vs using Magento for managing their Product Information ?
There are several. For example Magento permission scheme is module based so once you have access to the module, you can see and modify pretty much everything (this is a big deal when you want to use third parties for images, translations, pricelists and whatnot).
Also Magento product management is not designed data enrichment in mind: it works, but it's pretty inconvenient when the number of product grows. As with many other built-in functions it's important to understand that Magento is first and foremost sales environment -- everything else is implemented as stubs, meant to be replaced with full fledged solutions once your business takes off.
BTW, PIM's are meant to make sure that your multi/omni channel marketing efforts have a single data source. Web store is just one of the channels.
The primary reason is because you want to increase productivity, meaning you want higher per employee revenue for the company. A PIM costs more up front but should save employee time thereby generating a return on investment. As part of the technology system we work with, we're the SMB providers for maintenance and rule mapping, there is a PIM/MDM which uploads data from supplier files cleaning them. You can look at esse.style, it's in dev but the data loads are running overnight, plan is 1million products by end of October and currently importing around 15,000-20,000/day new per day, the addtions are 10-100x slower than the updates and delta checks. We're using the same PIM but for passthrough rather than inline editing, the install was started last week 5th Sep.
Once loaded to the pim users go in and enrich the data manually with descriptions, translations, pricing updates (although this is mostly automated via a special realtime pricing sytem), it also has an inline image editor. Any changes are then auto-synced to Magento adding more enrichments such as url prefixes/suffixes for ranking, categorisation in to brands, etc. You can go to eappware.com, they designed this technology with the help of some enterprise architects, they conferenced with Walmart's onboarding tech partner, but they don't sell to the public. It's a reference site as they are SME based and normally integrate the technology in to the complete environments we work with, hosting, realtime pricing, mdm/pim, business process change, supplier onboarding, erp, etc.
Magento has a very basic pim, and the pricing system is horrible, the architects stripped it out and replaced it so users only enter one price and it recalcs in realtime cogs, taxes, shipping, import duties, discounts for ship to country. A good PIM will help reduce the workload, but if it's not implemented correctly it will increase it for both the users and the technology. For example, for SMB sites we use an Excel tool instead and it enriches the data via drag-drop which autoloads to Magento, a PIM would not provide a return on investment. The downside is that a PIM means your employees need to be more productive, and many employees don't like change, as you can, in the case of implementations like informatica or eappware, do the same with 50% less resource which can lead to hr issues.