In short you can understand both the terms as,
Social Media Optimization Include Blogging, Video Sharing, Image Sharing, Social Networking.
Search Engine Optimization include On Page SEO and Off Page SEO.
SEO or search engine optimization is the use of various techniques to optimise your website on the SERP to rank them higher.
SMO or social media optimiZation on the other hand is strategically using various social media platforms, to promote your brand, product or service.
SEO or search engine optimization is the process of optimizing your website in search engines. The process helps to build your online identity and reputation to benefit your online business.
SMO stands for social media optimization and is the process of optimizing your website in various social media websites. It helps to promote your website in various social networking websites to build traffic and also build your business popularity in search engines.