The purpose of this study is to determine how service firms use social media in their marketing strategy. Specifically, three parts of marketing strategy are analysed: the communication mix used by service firms; the management of customer relationships and new service development (NSD). Results from 18 businesses in 3 service industries (fitness, tourism and education) show that only about half of the businesses employ a qualified manager for social media. However, all sample companies measure social media effectiveness. Although all participant businesses promote their offers in various social media and cultivate intimate relationships with customers, using social media for developing new services is less common and found mostly in Greek fitness centres where customers are asked to vote for ideas for new services; provide opinions on existing services, and share their ideas.