The inexperienced Springboks missed 24 tackles and turned possession over six times at the breakdown during the match at the Westpac Stadium in Wellington.
"The scoreboard does look ugly, even though we played good rugby at stages during the game," said Smit. "You're always going to pay if you turn over possession at this level, and we certainly paid for that against these blokes.
"You also can't afford to miss so many tackles, which also cost us tonight."
South Africa, who have opted to field a second string side in the tournament, have now lost both of their matches after their defeat to Australia last weekend.
The Springboks will next move on to Durban for their match with Australia on Saturday, August 20.