SEO will helps in increasing the back links and page rank, where SMM helps in Promoting the site, brings your site in good position and increases the good visibility.
SEO is all about the identifying the keywords position,meta key word, meta tag etc. SMM is all about the directories submission, bookmark submission, posting links to social media etc.
Lot of companies provides you the SEO & SMM services. with affordable cost, and makes your site more visible.
Nichesuite is one of the best SEO and SMM solution providers in the market.

In Digital Marketing, SMM or Social Media Marketing is more important as it prioritizes on Marketing of a particular product or service over the Internet. Examples of SMM are Media Sharing Sites like YouTube and Flickr. Here, a person can upload files like videos, images and so on for marketing a business digitally. SEO on the other hand mainly focuses on the improvement of a site’s visibility within Internet Search Engines and are not necessarily confined to Digital Media like YouTube that too for marketing purpose alone.
From business products to service providers the sole intention most websites concentrate on is to write SEO based content to appear on top of all search results on World Wide Web.

SEO:-
Search engine optimization (SEO) is the process of improving the visibility of a website or a web page in search engines via the “natural” or “un-paid” or “organic” search results.

SMM:-
Social Media Marketing (SMM) is the process of promoting your site or business through social media channels. It is a powerful strategy that connects you with your target market in a manner that no other marketing avenue can.

Establishing huge user network, sharing their content, opinions, views, and encouraging interaction and community building via social media channels like Twitter, Facebook, Digg, Stumble Upon and more. The main purpose here is to get direct traffic.

From Yahoo Answers