The division will work to create new video, data and other rich media advertising solutions, which “provide a marriage of targeting and true relevancy”.
The new team will be led by former Apple worldwide product marketer Joshua Ramirez, who will become the company’s director of product innovation.
He joins from AOL, where he was responsible for leading the full-scale redesign of its email service. Prior to joining AOL, Ramirez was principal product manager at eBay and also spent several years launching numerous Apple Mac products.
Ramirez and his team will report into Shaun Gregory, Telefonica Digital global director of advertising.
Gregory says: “The establishment of this new team is recognition of the need to evolve beyond current advertising formats. Silicon Valley was the natural place to build a team whose mission is to shake things up and innovate on a global scale.”
Last year Telefonica Digital placed advertising at the heart of its growth strategy as it set out its target to earn €5bn (£3.98bn) in revenue by 2015.
The company says mobile’s share of media spend (3 per cent, according to internet trends analyst Mary Meeker) is currently disproportionate to the amount of time consumers spend using their smartphones (12 per cent of their time), which represents a “significant opportunity” for growth.