BEIJING — In the U.S., AI chatbot competition often emphasizes building the best models. In China, companies are fighting to make chatbots part of people’s daily routines — frequently by handing out freebies.
Nineteen-year-old delivery driver Li Hao said he normally uses ByteDance’s Doubao, the country’s most popular chatbot. During the Lunar New Year he tried Alibaba’s Qwen because the company was giving away milk tea for orders placed through the bot. “I tried it and got a milk tea,” he said. “After that, I didn’t use it again.”
That tactic — using promotions to drive trial and transactions — has defined much of the country’s chatbot battle. Big tech firms and startups, including Alibaba, Tencent, ByteDance, Baidu, Moonshot AI and DeepSeek, spent heavily on holiday promotions to attract users and demonstrate practical uses for AI in shopping and services.
Alibaba said it set aside more than $430 million for holiday promotions. Tencent and Baidu distributed millions in coupons and prizes. Morgan Stanley estimated the top apps spent over $1.1 billion combined on Lunar New Year campaigns, a period when consumers traditionally exchange cash-filled red envelopes.
Analysts see echoes of previous platform wars. “Competition between domestic Chinese tech players [is] heating up again, which I believe is a good thing…from the perspective of innovation,” said George Chen, a tech analyst with the Asia Group in Hong Kong. He compared the current spending surge to the decade-old rivalry between Alibaba and Tencent over payments, which helped accelerate e-commerce adoption in China. “History is repeating,” he said.
The immediate battleground is getting people to transact through AI. Qwen can accept a simple prompt like “I want to order a milk tea,” show nearby options, customize the drink and handle payment in-app via Alipay. Doubao is integrated into Douyin (China’s TikTok), acting like a direct-message companion. Tencent’s Yuanbao is tied into WeChat and WeChat Pay. These integrations let chatbots do more than answer questions: they can book flights, hail rides or schedule doctor appointments within a single conversation.
Alibaba appears to view Qwen as a route to becoming an “everything app,” with the AI model serving as the primary interface for many online and offline activities. Kyle Chan of the Brookings Institution said Alibaba envisions its model as the starting point for interacting with a broad range of services.
The promotions drove heavy traffic. QuestMobile reported more than 73.5 million people used Qwen on Feb. 7 during the surge. ByteDance’s Doubao topped 144 million daily users after promotions tied to the state-run Lunar New Year TV gala. The spike in orders even caused disruption in some takeout shops, where footage showed chaos as demand surged.
Retaining users after the promotional rush is the bigger test. Media reports indicate daily usage has fallen since the holiday. Li Hao went back to Doubao after trying Qwen for the free milk tea. “I still prefer using Doubao,” he said.
For Chinese tech companies, success won’t be decided only by the quality of underlying models. It will hinge on how well they embed AI into existing super-app ecosystems so chatbots become convenient, habitual ways to complete real transactions. Industry observers say those habitual behaviors may determine which platforms retain users once the giveaways end.