Beijing, 3 February 2026 – Alibaba Group Holding Ltd. has announced a major 3 billion yuan (about US$431 million) promotional campaign for its Qwen artificial intelligence app during the upcoming Lunar New Year holiday, dramatically intensifying competition among China’s largest technology firms in the booming AI chatbot market.
The initiative, set to kick off on 6 February and run through the extended nine-day Lunar New Year public holiday beginning 15 February, will deploy incentives designed to attract new users to Alibaba’s AI platform. Details of the rewards include incentives tied to dining, entertainment, drinks and leisure activities, with “large red envelopes” set to be distributed continuously, a strategy that echoes popular digital marketing techniques around the festive season.
Stakes Rise in China’s AI User Acquisition Race
Alibaba’s spending plan dwarfs recent efforts by its domestic rivals. Tencent Holdings Ltd. said last month it will allocate 1 billion yuan to promote its Yuanbao chatbot, while Baidu Inc. has earmarked 500 million yuan for its AI chatbot promotions, a sign that competition for chatbot users in China has shifted into high gear.
The focus on Lunar New Year as a battleground for AI promotion is strategic: the holiday period attracts hundreds of millions of travelers and online users, making it an ideal window for platforms to rapidly grow user engagement and network effects. Chinese tech companies have historically used the holiday season to drive mass adoption; for example, Tencent’s distribution of digital red envelopes on its WeChat platform in 2015 helped boost WeChat Pay’s market penetration amid a fierce payments market rivalry.
A Broader Battle for AI Ecosystem Dominance
Alibaba’s move reflects a broader evolution in China’s AI landscape, where competition is moving beyond model development and performance benchmarks toward user acquisition, ecosystem integration and platform stickiness. By tying AI engagement to lifestyle incentives across dining and leisure, Alibaba is deploying a consumer-first approach that seeks to lock users into its broader digital ecosystem, including services tied to its huge e-commerce and cloud infrastructure.
Tech observers note that the launch of innovative models like DeepSeek’s R1 last year contributed to an acceleration in domestic AI competition, prompting established companies to front-load investments in marketing and user incentives ahead of key calendar moments such as the Lunar New Year. Several firms are also gearing up to release new AI model upgrades in the coming weeks, further intensifying the race.
Why This Matters
Alibaba’s 3 billion yuan AI push is one of the largest marketing outlays in China’s AI sector to date, underscoring how rapidly the arms race for chatbot dominance has escalated. Massive promotional spending on popular holidays could help platforms capture long-term active users, which are critical for monetization, data collection and competitive positioning in areas ranging from cloud computing to generative AI services.
Industry watchers say the campaign will not only test the strength of Alibaba’s Qwen ecosystem but also serve as a bellwether for how Chinese tech giants are transitioning from lab-based innovation to large-scale consumer rollout strategies in the era of generative AI, where user base and engagement are becoming key metrics of success.
