Using SMTP AUTH we can make it possible for clients, colleagues, and ourselves to relay messages from everywhere in the world using only one (our) SMTP server.
Being mobile then we don't have to deal with the hassle to find a SMTP server that permits us to relay.
Once set up, we do not have to give extra support to others to reconfigure their mail clients properly.
We can make use of scripts and daemons that run on our server and provide services that we need e.g. server-side virus scanning.
Imagine all users are allowed to send messages to users in the local network, but only a few should be permitted to send messages to remote users. If you check by IP the forbidden users simply have to use a machine with a valid IP. This is where SMTP AUTH can also help you as it checks for users and not IP. You then only provide SMTP AUTH accounts for those who may relay outbound messages and configure Postfix to reject other senders.
We can enable our SMTP server to authenticate itself with other SMTP servers.
We might use this when our ISP requires us to authenticate our (dial-up) SMTP server or even connect several (dial-up) company locations to each other in order to provide safe and explicit messaging.
Finally we can add an extra layer of security to encrypted communication (TLS).
You want that? Understand the process of SMTP AUTH first, before you install and configure. It will save lot's of time when you need to trace down a malfunction. You will know where things go wrong and be able to concentrate on that only.