The race for dominance in China's artificial intelligence (AI) market has intensified on the eve of the Chinese New Year. ByteDance's flagship AI large-language model (LLM) "Doubao" launched a festive promotion campaign featuring on red envelopes and tech giveaways, stepping straight into the high-stakes user competition during the peak holiday season.

On the evening of February 16, the Chinese New Year's Eve, Doubao will distribute more than 100,000 technology-themed gifts to audiences through the Spring Festival Gala, along with New Year cash red envelops  of up to 8,888 yuan ($1,280), according to a statement released by Doubao on Tuesday via its official WeChat account.

All the technology gifts are integrated with the Doubao LLM, the statement said. The prizes span 17 popular technology products, ranging from cutting-edge innovations such as Unitree robots, Songyan Power robots, Magiclab's robotic dogs and DJI drones, to smart consumer products, including Xiaomi smartwatches and Supor rice cookers. Winners will also have opportunities to receive usage rights for two electric vehicle models - the SAIC Audi E5 Sportback and the Mercedes-Benz CLA, the statement said.

Liu Dingding, a veteran technology industry analyst, told the Global Times on Tuesday that ByteDance's Doubao is set to join the battle for user acquisition. Capitalizing on its high-profile sponsorship of China Central Television's Spring Festival Gala and its vast existing user base, the app is expected to prioritize ecosystem integration and channel advantages over mere marketing outreach.

Leveraging the Spring Festival cultural setting allows large-model platforms to rapidly expand user reach at relatively low cost, Bian Yongzu, an executive deputy editor-in-chief of Modernization of Management magazine, told the Global Times, noting that red-envelop campaigns resonate with users more for their symbolic meaning than for the monetary value. At this stage, such initiatives offer strong communication efficiency.

Alibaba's Qwen app on Friday launched a Spring Festival giveaway worth 3 billion yuan, under which users were given 25 yuan no-threshold free milk tea gift cards that encourage them to place drink orders directly through the app's chat interface. The campaign has prompted a lot of discussion online, with many users posting photos showing that milk tea shops were overwhelmed by delivery workers.

Other Chinese AI LLM companies, including Baidu, Tencent and ByteDance, have rolled out digital red envelope initiatives, with a total estimated value of more than 4.5 billion yuan.

Last week, Tencent's Yuanbao launched a digital red packet campaign, distributing up to 1 billion yuan in digital red packets to users, with individual red packets worth as much as 10,000 yuan. Baidu's AI assistant Ernie announced that from January 26 to March 12, people who use the app will have the chance to share 500 million yuan in cash red envelops.

For LLMs, user scale itself is a critical foundation for optimization and capability enhancement, Bian said. Broader participation by real users accelerates iteration through feedback, scenario adaptation and functional refinement. As a result, intensifying promotion during the Spring Festival period delivers stronger market impact than routine campaigns, which explains why multiple leading models have rolled out similar initiatives in a concentrated period.

What superficially resembles a "red envelope war" is fundamentally a race to secure AI user touchpoints. This uniquely Chinese promotional model, Liu noted, will accelerate AI adoption and shift industry competition away from a narrow focus on technical specifications toward real-world utility and value.

The intense competition also reflects the high level of dynamism in China's LLM sector and underscores the country's distinctive global position, Bian said. Globally, only a handful of countries are capable of supporting multiple LLM developers at the same time, with China and the US clearly leading — a reflection of national technological strength, industrial depth and research capacity.

However, sustained user retention depends on technological sophistication and product performance rather than short-term promotional tactics, Bian said. Users remain loyal only if models deliver tangible value in real-world applications such as work and study. Marketing can attract attention, but long-term competitiveness hinges on continuous innovation and the ability to deliver products on par with global leaders, he added.

As of December 2025, China's generative AI user base had reached 602 million, up 141.7 percent from the end of 2024, with the penetration rate climbing to 42.8 percent — an increase of 25.2 percentage points year on year, according to the Economic Daily.

With more than 600 million users and penetration exceeding 40 percent, the figures vividly illustrate how AI has moved from the laboratory into everyday life, while laying the strongest possible user base and market foundation for China's full-scale implementation of the "AI Plus" initiative, the Economic Daily said.