Palmer, whose decade-long Black Fern career included three Women's Rugby World Cup wins, said it was great to see rugby women presented as role models.
"Every time you do well on the world stage the interest in that particular sport does go up ... It just shows you that young girls and women look up to these athletes as role models and think if they can do it so can I, and I really think it's a positive thing."
As one of those role models, Woodman said it had been great to see the inspiration of the Black Ferns influence women's participation in the sport.
"We've seen a massive increase of women playing rugby, girls playing rugby .... now that we've won this award who knows where it's gonna go, I think its been said that women's rugby can overtake the men's in the growth, so I think it's just the start."
New Zealand Rugby Chief Executive Steve Tew congratulated the Black Ferns on their historic success and said: "the Black Ferns have earned their place as the world's best".
"To be the first women's team to win Team of the Year is a fitting tribute to their talent, dedication and hard work," said Tew.
"This has been an outstanding year for our women's rugby teams, and the international recognition that our players and teams have received is totally deserved."