The Cocktail Hour is that period of your celebration after the Postlude. Your guests have left the area where your ceremony occurred and are milling around, having a few snacks and drinks and anticipating the rest of the evening.
Typically this occurs right outside of the reception hall. During this time the room is being prepared for your guests by the venue staff. Sometimes the bride and groom will mingle and take pictures, but in many cases they are out of sight. This builds anticipation in the guests for their grand entrance with the rest of the bridal party during the first part of the reception.
As for music for this portion of the event, Jazz usually works well. You might hire a solo pianist or small combo. The music should be somewhat upbeat, without being so loud as to interfere with your guests. Usually Cocktail Hour music is instrumental only, but of course it is your choice.
If you've had a beach wedding, you might consider a steel drum player, guitarist, or other acoustic performer. This creates a nice touch. A jazz band would usually need electricity, so that a beach performance isn't possible.
As the hour winds down, the band will probably break briefly, to move into the reception area. There they will set up and prepare for your grand entrance!