Glasgow's backline misfired on Saturday, while the absence of players in key positions was felt.
Smith said: "Yeah, it definitely stings. I think we let ourselves down, having done so much hard work in the start of the tournament to get four wins and secure the second spot to have a home playoff. I think we've missed an opportunity, but it's on us as players. We didn't execute things the way we wanted to.
"The game plan was there, which has been set up perfectly, but we just missed opportunities on both sides of the ball. We granted Toulon some easy opportunities into our half to score points and we focus on that as backs. We spoke about it on Monday morning, as backs.
"I think the forwards fronted up fantastically well to defend in our own 22 for so long, especially some of the guys that they had in their forward pack, especially coming off the bench as well.
"I thought they were outstanding, but as backs, we just weren't good enough in stopping some of their boys and giving them easy points."
Asked why, he added: "We haven't really managed to put a finger on at the moment.
"It's difficult because you can't pin it down to one thing. You can't say it's skill execution, you can't say it's breakdown, you can't say it's depth.
"It's just some things that feel off and that can be for a number of reasons. It can just be mental fatigue or there's been a lot of rugby that's been played and the occasion even knockout rugby but there's no real excuse for why it's not clicking.
"I think we just have to be diligent enough and blunt enough with each other to say that it needs to be better and if we want to take something away from this season.
"We've worked so hard to get to the position we're in, that needs to be better and we need to just figure out the solutions."