My suggestion would be some play therapy, especially if you think he is having a very hard time with it and let the therapist help him develop some strategies that might help him be sucessful, his speech therapist can add a social goal too, and you could have more therapy. If he is in public therapy at your school, I would suggest adding private therapy too, as much as you can afford. School services are only obligated to make him functional, and you want more than that for him. If you have not gone to the school and asked for public services, then do it too. After age three, the public school is obligated to serve all children with disablities who need special education services, and an articulation disorder that causes intelegiblity issues like you describe should qualify.
I have been there, and watching your son be rejected is hard. Good therapists may also have social skills groups where he can interact with other kid his age who are having the same kinds of social issues, he may not have a primary social skills issue, but it could be secondary without successful give and take exchanges with his peers.
Sometimes a switch to a new setting or a new group of kids will be helpful. All you can do is to encourage him, and love him. I don't know that there is anything he can understand at this age that will make it better for him other than finding a way for him to fill his social needs. My experience is that therapists are better at getting the idea across, for some reason, they seem to hear more of what they say and just look to Mom for comfort.
I feel for you,
M.