This week I gave a speech at the Facebook Global Sales Conference, up in Palo Alto, on the role of creativity in social media. I enjoyed meeting and hanging out with the Facebook team. A lot of energy and excitement going on there.

The theme for my presentation, on Google Docs here, is that social media is going to usher in a big demand for creativity in advertising.

The Power of Social Media

Recently there’s been some highly-illuminating information on the impact of social media. Firstly, we’re seeing social media driving a lot of traffic to sites. The average for this is 20% of a site’s visitors. That means for some sites, it’s significantly higher.

This is one of Google’s challenges. As a search tool, it’s far from perfect. And people are finding that their network is a more effective resource than Google, in many ways. Twitter’s ability to provide relevant search info quickly paints a similar story.

And when you think about it, of course your friends are going to be better at predicting what you’d like than a Google algorithm. That’s why they’re your friends. Friendships are based on shared interests.

But perhaps the ultimate proof of social media’s power is the almighty conversion. And here we’re seeing conversion numbers 2-4 times higher. That’s a remarkable leap in performance — a stat even a direct marketer can love.

Paid Media Isn’t Going Away

While social media is undeniably powerful, keep in mind that no matter how popular it gets this year, the overwhelming portion of ad spending will be paid media. And frankly, paid media will  be a big factor for a long time.

Paid media actually makes for a great partnership with social media. There are only a handful of sites that have risen to prominence without any paid media. And a lot of the so-called viral or social media success stories were heavily fueled by a paid media launch. That’s all fine. In fact, it’s the way it should be. Companies rarely have time for 100% organic viral growth. Sometimes you have to spike the punch.

The question then is, What’s the tactical relationship between paid and social media?

Turning Paid Impressions into Social Endorsements

So paid media can feed the social media monster. The question is, How?

Any social media campaign has one major requirement. That it be something people want to share. Without that, it’s not social. Just more stuff posted to the Web.

Having something share-worthy isn’t easy, as few products are what Seth Godin would call “purple cows” — products that generate their own word of mouth. Outside of entertainment properties, it’s hard to think of a category in which people watch the ads as a way of gaining product information.

So the ‘news factor’ has to come from somewhere.

A base level tactic is to include sharing features at every touchpoint of your campaign. Make it easier for people to take it social. This could be Facebook Connect and other types of universal logins on all your campaign assets — from websites to banners. But those are really more foundational tactics. And it also assumes that the ad or website we’re featuring has inherent news-worthiness. Not a likely situation.

Creatively-speaking, social media is a much more challenging environment. In my presentation to Facebook, I mentioned that there are a lot of paid media ads that most people would consider pretty bad from a messaging standpoint (think the Clapper, or the Snuggie), yet they’re still able to produce positive numbers. They’ll drive a certain level of traffic, some of which will convert to sales.

With paid media, the biggest requirement from the reader is to simply NOT skip or ignore the ad. Think about that. To ‘not’ receive a paid media placement, you have to do something. That’s ironic. With social media, there has to be some sort of action on some person’s behalf, to generate the endorsement.

That makes understanding the consumer more important than ever. Because you have to gauge what will interest them at a much deeper level. When you hit it, it’s extremely powerful, as the conversion rates are showing. But it’s not a level of creative thinking that you can simply phone in.

So the ‘creative’, whatever that may be, has to be something that will separate from the rest of the media noise. And that’s probably not an ad, unless it’s insanely funny.

Content-based creative, like video and Facebook apps, offer a lot of potential impact. But they’re going to have to respond to what will inevitably be a surge in similar campaigns. All vying for people’s endorsement.

So getting any sizeable reaction from viewers is going to require a big leap in creative over what everyone else is putting out there. After all, consumers aren’t going to increase their rates of endorsing. In fact, it’s going to decrease on a percentage basis as more and more companies swing for a social media hit.

In that environment, the creative will definitely be king. Outside of product development itself, it will be the only thing that can get a company into the conversation. But it’s going to take a lot of understanding, thinking, learning, and refining.

In short, it’s going to take a lot of creativity.