Alibaba announced on Monday that it will invest 3 billion yuan ($431 million) to gain users to their Qwen AI app over the Lunar New Year holiday, fueling a contest among the largest tech companies in China.
Alibaba has pledged to increase its expenditure three times more than what was promised by its competitors, Tencent and Baidu. It is set to begin on February 6.
Alibaba said in a statement that it will include incentives for dining, drinks, entertainment, and leisure, with “large red envelopes distributed continuously.” At the end of last month, Tencent and Baidu declared that they would invest 1 billion yuan and 500 million yuan each in comparable marketing of their AI chatbots.
The Lunar New Year period, when hundreds of millions of Chinese people go home and reunite with their families, has long been a marketing battleground where Chinese tech companies seek to win over new users.
The most significant example was in 2015, when Tencent used its WeChat messaging platform to issue digital red envelopes to promote its WeChat Pay service to the rival Alipay in China, which at that time controlled the mobile payments market.
During the public holiday period this year, which begins on February 15 and is nine days long, there is an increase in many previous years.
The pace of competition in the Chinese AI industry has been increasing with the launch of the DeepSeek R1 model in January of last year, shaking the AI markets across the globe, prompting not only an accelerated uptake among the Chinese but also an intensified competition among the domestic industry.
However, the promotion of Tencent is centred on their Yuanbao chatbot application and begins on Sunday. The users will have to update the application to the most recent version in order to grab digital red envelopes, which can be lost in their WeChat wallets. Users are also able to share a link with cash rewards to be claimed by others.
Alibaba did not mention how its rewards would be issued, whether it would be a cash red envelope or a discount coupon, which can be paid on its platforms, including e-commerce store Taobao.
Other Chinese AI companies have also been launching upgrades in the lead-up to the holiday. The Information has reported that DeepSeek is expected to roll out its next-generation AI model V4 with powerful coding features in mid-February.
