Bytedance increased the total value of red packets offered on three of its apps to RMB 1.6 billion (almost $237 million) this recent Chinese New Year, up from RMB 1 billion last year, to become the biggest player in the Chinese hongbao battle in terms of prize money offered, according to a report from Jiemian.
The RMB 1.6 billion was distributed between content aggregator Jinri Toutiao, short video app Douyin, and social networking app Duoshan. The three apps received RMB 1 billion, RMB 500 million, and RMB 100 million respectively, according to the Jiemian report. They used the money for different Spring Festival promotional activities: users either collect tokens to qualify for a prize money raffle in the form of hongbao issued by the platform or are directly rewarded for participation.
Douyin’s event probably drew inspiration from its Ant Financial-owned Alipay equivalent, which has been held every Spring Festival since 2016. While Alipay’s event asks users for tokens that can be obtained by paying with the app, event tokens in Douyin can be acquired by inviting friends to the app or installing Duoshan.
While this is the second year that Jinri Toutiao has held its Spring Festival red packet event, it is the first for Douyin and Doushan.
More than 61 million people qualified for the draw in Douyin, according to a report from Bytedance (in Chinese). The exact number of participants of Duoshan’s Spring Festival promotional activity is still not available, according to a Bytedance spokesperson.
Chinese people give each other red packets for good luck during Chinese New Year, but in recent years platforms like Alipay, Taobao, and Wechat have been offering users electronic red packets, taking advantage of this tradition to promote their services.
Bytedance is not the only contender in the Spring Festival hongbao battle. Search giant Baidu partnered with China Central Television (CCTV) to distribute RMB 1 billion worth of red packets during the state media’s Spring Festival Gala (chunwan). Alipay offered RMB 500 million worth of hongbao in its collect-token-to-qualify-for-red-packet event and attracted more than 450 million participants. The short video app Kuaishou also recorded more than 100 million users joining in its hongbao event, which saw the app give away RMB 700 million worth of red packets.
Steam, the international games-distribution platform, also had a tokens-for-red packets promotion event that lead to greater discounts on games. Data, however, on how much they “gave away” was not readily available, but there was with much speculation and complaints by users.
Bytedance’s doubling down on its promotional efforts amid fierce competition is reminiscent of the hongbao battles between Alipay and Wechat a few years ago when the two platforms sought to establish themselves the default payment method. Wechat and Alipay rolled back their promotions two and three years into the battle, respectively.
Correction: This story has been amended to clarify that Douyin received RMB 500 million from parent company Bytedance to spend on red packet giveaways, not RMB 600 million as previously reported. The dollar equivalent of RMB 1.6 billion was also corrected from $23 million to $237 million.