According to the book The Hobbit by J.R.R. Tolkien:
Smaug asks, "Who are you and where do you come from, may I ask?"
Bilbo answered, "You may indeed! I come from under the hill, and under the hills and over the hills my paths led. And through the air, I am he that walks unseen. I am the clue-finder, the web-cutter, the stinging fly. I was chosen for the lucky number. I am he that buries his friends alive and drowns them and draws them alive again from the water. I came from the end of a bag, but no bag went over me. I am the friend of bears and the guest of eagles. I am Ringwinner and Luckwearer; and I am Barrel-rider."
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'I come from under the hill, and under the hills and over the hills my paths led. And through the air. I am he that walks unseen. I am the clue-finder, the web-cutter, the stinging fly. I was chosen for the lucky number. I am he that buries his friends alive and drowns them and draws them alive again from the water. I came from the end of bag, but no bag went over me. I am the friend of bears and the guest of eagles. I am Ring-winner and Luckwearer; and I am Barrel-rider.'
Barrel-rider, he that walks unseeen, ringwinner, luckwearer, clue-finder, web-cutter, stinging fly, he that buries his friends alive and drowns them and draws them out alive, friend of bears, guest of eagles.
Smaug doesn't recognize the scent of Hobbit, although he knows what dwarves and men smell like.
Bilbo told Smaug a riddle to keep him distracted.
Smaug tells Bilbo not to trust dwarves:In return for the excellent meal [of the Company's ponies] I will give you one piece of advice for your good: don't have more to do with dwarves than you can help!Smaug-The Hobbit: "Inside Information"
Clue finder is one of the names that the invisible Bilbo Baggins uses when he boasts to Smaug the dragon.
His sense of smell. It is one of the main reasons why Gandalf chooses Bilbo as the 14th member of the Company (because while Smaug would be familiar with the smell of Dwarf, the smell of Hobbit "would be all but unknown to him").