As the Lunar New Year approaches, China’s leading technology companies have escalated a familiar seasonal ritual into a full‑blown marketing battle that blends old customs with new technologies. Baidu has announced a 500 million yuan cash campaign while Tencent has countered with a headline‑grabbing 1 billion yuan giveaway, including single red packets worth as much as 10,000 yuan that can be withdrawn directly to WeChat. The promotions are not mere festive largesse: they are a high‑stakes competition for attention, payments flow and AI legitimacy.
Baidu framed its campaign around its generative‑AI ecosystem. At the company’s Wenxin Moment 2026 event it showcased a digitally rendered “digital human” — a virtual presenter created by its Huibo Xing platform — tying the cash giveaways to demonstrations of its AI products and ecosystem services. Tencent’s move, by contrast, links enormous red packets directly into its payments and social matrix, using cash incentives to keep users inside WeChat and its broader commerce stack.
These manoeuvres matter because the Spring Festival is a peak moment for consumer activity and social sharing in China. Digital red packets are a culturally resonant tool for user acquisition and engagement: they create short‑term spikes in transactions, raise app stickiness and generate viral social media moments. For platforms building AI services, the holiday is an opportunity to marry a culturally embedded mechanism with product trials and data capture — nudging users to try AI features while boosting short‑term revenues and long‑term engagement metrics.
But the cash splurge also exposes tensions beneath the theatre. Generous subsidies are costly and can be hard to scale sustainably; they risk normalising heavy discounting as the price of user attention. Regulators who have already tightened rules around platform competition and financial stability will be watching how these promotions intersect with payments, consumer protection and the monetisation of AI. The campaigns also underscore how rapidly AI has shifted from a technical showcase to a marketing lever — virtual hosts, personalised interactions and AI‑driven content are now elements of seasonal brand warfare.
For consumers the immediate effect is straightforward: more cash incentives and prominent AI experiences during the holiday. For rivals and investors, the contest signals which companies are confident enough in their ecosystems to spend heavily on liquidity and marketing. For policymakers, it raises questions about market conduct and the long‑term health of platform competition once the Lunar New Year lights dim and promotional budgets are drawn down.
Ultimately, the 2026 Spring Festival shows China’s tech giants using cultural moments to accelerate product adoption and narrative control. Whether billions spent on red packets will translate into sustained gains in AI market share, payment dominance or user loyalty remains the central question as the industry moves from spectacle to substance.