Short video platform Kuaishou will send out cash red packets (hongbao) totaling RMB 1 billion ($142.6 million) on the eve of the Chinese New Year, LatePost is reporting. The holiday falls on Jan. 24 2020,
Why it matters: Kuaishou entered “battle mode” in June. The company wants to boost users to 300 million daily active users (DAUs) before the Spring Festival holiday.
- The goal was broken down into achieving a peak DAU of 300 million before the Spring Festival and reaching an average DAU of 300 million three months after the holiday.
- Kuaishou Lite is expected to contribute 60 million DAUs to the 300 million goal by late January. The lightweight version of the app loads faster, but has fewer features.
- The current DAU for Kuaishou is between 200-210 million.
Details: If successful, Kuaishou’s spending will exceed the RMB 900 million Baidu spent on Spring Festival hongbao in 2019.
- Cash red packets are only part of Kuaishou’s Spring Festival campaign, which was finalized in mid-December after two months of internal competition between eight teams.
- Kuaishou will also issue vouchers for some e-commerce platforms.
- Some Kuaishou employees did not go home for two weeks to prepare for the campaign.
- Kuaishou replaced Baidu to become the exclusive interactive partner of China Central Television’s 2020 Spring Festival Gala, one of the most-watched television shows of the year.
- Kuaishou recently fired an employee for disclosing details of the company’s Spring Festival campaign and some e-commerce data to Chinese media. The company also confiscated all of the employee’s shares.
Context: Chinese people give each other red packets as a gesture of good fortune during Chinese New Year, but tech companies have increasingly used it as a means to market their products and boost their user base.
- Tencent’s WeChat was the first app to start issuing hongbao but has stopped in 2016. Alibaba’s Alipay also followed suit and canceled cash hongbao in 2017 but still kept other celebratory activities giving away cash.
- In 2019, Baidu’s Spring Festival giveaway totaled RMB 1 billion, led only by Bytedance, which offered RMB 1.6 billion of cash prizes across Jinri Toutiao, Douyin, and Duoshan for the period.