When you schmooze at a party, you chat with many different people. Being able to schmooze casually and confidently is a good quality in a hostess or a politician.
If you say, "I just want to stop by the reception and schmooze for a little bit," it means you're going to see who's there and make smalltalk with various people. You might want to schmooze for fun, or take the opportunity to hand out your business card. You can call the conversation itself a schmooze too, and the word comes from the Yiddish shmuesn, "to chat" from shmues, "idle talk," with the Hebrew root shemu'oth, "rumors."