According to research by specialist business insurer Hiscox, entrepreneurs that have incorporated social media into their business models claim they use it to not only to increase brand awareness (27%) and boost sales (15%) but to also improve their customer service (11%).

When asked what types of social networks businesses are using the most, Facebook was the most popular at 18%. Facebook ranked higher than more than overtly business-orientated sites like LinkedIn (13%) and company-own blogs (13%).

Currently only a small number of the businesses involved in the research (12%) said they are taking advantage of the social media benefits and using web tools all the time, whereas a greater proportion (25%) reported they look at social media when they had the time.

There is significant opportunity for entrepreneurs to drive business with only a small minority (7%) using social media to achieve a high level of search engine optimization and natural search results or to generate sales (6% of small businesses and 21% of medium businesses).

Over the coming three years, the budget allocated to social media is expected to significantly increase.

Other research by The Neilsen Company found that with four in five active internet users visit social networks and blogs and just over half of all adults (53%) who engage in social networks are active followers of a brand. This demonstrates that the potential rewards and quick wins of investing in social media, particularly in terms of brand exposure, could be great.