I love this definition - it is short and covers the multiple purposes.....
Social networking is the use of internet-based social media programs to make connections with friends, family, classmates, customers and clients. Social networking can occur for social purposes, business purposes or both through sites such as Facebook, Twitter, LinkedIn, Classmates.com and Yelp. Social networking is also a significant target area for marketers seeking to engage users.
and as far as using it for business purposes.....
Marketers use social networking for developing brand, increasing brand recognition and developing brand loyalty. It makes the company more accessible to new customers and more recognizable for existing customers, social networking helps promote a brand’s voice and content. For example, a frequent Twitter user may hear of a company for the first time through a news feed and decide to buy a product or service. The more exposed people are to a company’s brand, the greater the company's chances of finding and retaining new customers. If one remembers that people need 5 to 12 exposures to a product before they buy - then social media is a great way to get those exposures for a small investment.