The best practice to add custom logic for data formatting in a grid column is to create a new class extending \Magento\Ui\Component\Listing\Columns\Column. The prepareDataSource method is designed for processing and formatting data before it is displayed in the UI component.

Using prepareDataSource in a Custom Column Class:

By extending \Magento\Ui\Component\Listing\Columns\Column, you gain access to the prepareDataSource method, where you can manipulate data as needed.

Adding a custom class allows for reusability and modular code, which is in line with Magento’s architecture.

Why Option B is Correct:

This option uses Magento’s UI component structure properly, focusing on the intended class and method for grid data manipulation. Option A involves an unnecessary plugin, and Option C with DataProvider preference is generally discouraged for simple UI modifications.

Implementation Steps:

Extend the Column class and add your logic in the prepareDataSource method.

Then, in your customer_listing.xml, reference this class within the node using the class attribute.