Online inventory has skyrocketed since the explosion of user-generated content, but, Ms. Millard said, "the reality is that there are very few companies -- if any -- that are doing what you would call a good job of monetizing it."
Marketers have been genuinely interested in harnessing this phenomenon for the past two years; it's Yahoo's job to show them how, she told analysts at the UBS media conference.
"All of a sudden, technology has facilitated the rise of the consumer voice in a way that is startling to many of us. But the reality is nobody's doing a great job helping a marketer understand how to leverage this stuff."
Ms. Millard was also none too impressed by the move to viral campaigns, having seen results on her own "test lab" at home.
"I have a 19-year-old and a 17-year-old, and they don't want to be [MySpace] friends with the Burger King king," she said.
Leading the social-media charge
Yahoo has long led the social-media charge with its e-mail, instant messaging and gaming services, tripling MySpace and quintupling YouTube in size.
"Social media is hard to monetize because that age group is so fickle," she said. "Think of all the failed magazines in this world. Nobody's ever been able to put their arms around it at the time. To hold them, you have to be very, very careful not only about the content but about the advertising."
"The question from a business standpoint is: How do you make money at this? It's fun, it's a blast, trying to figure this out, but I don't think anyone is doing it particularly well," she said.
'Peanut butter' memo
The panel's candid vibe continued when an audience member broached the topic of Yahoo Senior VP Brad Garlinghouse's now-infamous "peanut butter" memo from two weeks ago (the internal memo criticized the lack of focus at the company, comparing Yahoo's efforts across all its properties to peanut butter spread too thin).
"I had a really hard time deciding whether I wanted fluff or jelly with that," Ms. Millard quipped. "The reality is, if you really look at that, you could take Yahoo's name off of that and put on almost any company you've ever worked for. This company has grown from $720 million five years to nearly $6 billion today. Is it challenging to grow with that accelerated pace? Is everything perfect? Can we make decisions as fast as a company with 100 people? No. So I looked at it as pretty silly in terms of the noise that was made of it.
"But the reality is," she continued, "we are a company that has grown at an extraordinary rate, and that doesn't come without questions about your ability to move with competitive speed."