What's the Protestants' view on the purpose of sacraments? Once an orthodox priest told me that Protestants themselves don't know what they need the sacraments for. He said that since they deny the doctrine of transubstantiation and have separated themselves from Apostolic succession of the universal Church, they don't experience the partaking of the divine nature (2 Peter 1:4) through sacraments, especially through Eucharist. 

He also said that Protestants' assertion that the sacrament of Eucharist is only needed as a reminder is rather ridiculous as "anyone can be reminded of that through hearing a sermon or through reading the Word". He said he doesn't deny that Eucharist has a function of a reminder, but there are some way deeper things pertaining to Eucharist that Protestants completely miss out on.

Honestly, he kind of needled me by that.

However, I am asking this question not so as to argue with him in the future, but to find out what Protestants themselves have to say on this regard - how do they view the purpose of sacraments.

I address this question to all Protestant Christians, in other words to those Christians who believe that Jesus Christ is the Son of God, and the very God Himself as God the Father is, and who also believe that there couldn't be one man who would solely be a representative of God to the Church, and those who also believe that the Universal Church can be spread and grow through merely sharing and hearing the Gospel, regardless of whether or not the one who shares that Gospel belongs to the Apostolic succession.
Asking "What do Protestants think about the sacraments?" is a bit misleading. There are a large variety of Protestant views, some of them are more traditional than others. The question as to whether Protestant groups are wholly divorced from the Apostolic succession is also not 100% correct. There are a few clearly Protestant groups who have at least some claim to succession (Certain Anglicans, the Old Catholic Church, etc.).

This is a statement from the Presbyterian Church of the USA (PCUSA): 


  In the words of John Calvin, sacraments are "a testimony of divine grace toward us, confirmed by an outward sign, with mutual attestation of our piety toward [God]." A sacrament is a testimony of God's favor toward the church, confirmed by an outward sign, with a mutual testifying of our godliness toward God. It is a primal, physical act that signifies a spiritual relationship between personal beings.


Here's the Lutheran perspective (ELCA):


  Contemporary theologians, especially Edward Schillebeeckx, have said that Christ is the "primordial sacrament." The grace that is received in the sacraments is the grace of Christ. In the two sacraments of Baptism and Eucharist Jesus Christ is the content of the sacrament as well as the minister of the sacrament. In both sacraments it is the whole Christ who encounters us. The sacraments are wonderful ways in which Christ is present to us. This is not to deny that Christ is present to us in other ways as well, but if we look at Christ’s command and Christ’s promise it is obvious that two actions are central.


The United Methodist Church (UMC) has similar thoughts:


  Like baptism, Holy Communion is regarded by Protestants as a sacrament. That is, it’s an act of worship ordained by Christ and is a means of grace. This does not mean that we become any more worthy of God’s grace by taking part in Communion. Rather, we open ourselves to the divine love that’s already there; we become more ready to receive that love and to respond to it.