Strapped for time and cash, small local businesses are increasingly turning to free and low-cost social media tools for their marketing efforts. Not surprisingly, the world's biggest social networking site tops of the list of preferred tools.

Seventy percent of local businesses use Facebook for marketing, according to a new report from Merchant Circle, a network of U.S. local business owners. This represents a 20% increase over the previous year.

The report notes that for the first time, Facebook is being used more than Google by local businesses for online marketing.

Facebook also seems to have an advantage in the location check-in space, with 32% of small businesses saying they use the feature, compared with just 9% who have tried Foursquare.

This new data comes just as ChompOn, a group buying site, revealed its own data showing that Facebook updates are three times more effective than tweets when it comes to getting consumers to make purchases online.

Nearly 40% of respondents in the Merchant Circle survey said they used Twitter for marketing, putting the microblogging site behind Facebook and Google.

The increased use of social marketing by small businesses should come as no surprise, considering the massive popular adoption of social networks and the low - often nonexistent - costs of using them. Web marketing companies in general have also been courting local businesses, about 51% of whom say that they're cold-called about online marketing services at least once per week.

The Merchant Circle survey is based on a random sample of 8,456 small business owners in the United States.