The rapid development of information technologies and digitalization have led to the fact that social networks have become the most popular and effective tool for communication and information exchange. The growth and development of social networks and the enormous increase in their popularity caused major changes in the private and business sectors. It caused certain demands and timely adjustments from companies in order to realize their potential and be competitive on the market. In the context of marketing, similar trends are also present. Digital marketing is growing day by day and a lot more companies are adapting and deciding to advertise on social networks. The existence of both, real and a virtual company profile is inevitable. Investing marketing efforts on both sides results in a more competitive position in the market. Successful companies are modernized and use social networks efficiently and effectively to influence consumer behaviour and shape their perception in various creative ways. They integrate social media into their marketing mix and overall business because they want to engage and build relationships with potential customers. The development of social networks has given new dimensions to the promotion of products and services, and the efficiency and speed of advertising has greatly increased. The mutual connection between the social networks themselves and the speed and ease of switching from the social network to web shops and purchasing the necessary products is unsurpassed. In just a few clicks of the mouse button, one can explore a large and diverse range of products and make a purchase in a few minutes. Advertising on social networks has brought innovation, accessibility and speed that were not possible before. Moreover, it provided huge impact on consumer behaviour patterns and their desire to buy. This graduate paper will theoretically and empirically investigate the impact of social networks on the personal, psychological and social factors of consumers. Also, various tools of social media advertising will be explored and explained as well as the impact of social media advertising and the ways in which social media influences consumer behaviour.