Yes, substitution is the right tool. You can use Lingua::EN::Numbers to turn digits into words.

#!/usr/bin/perl
use warnings;
use strict;
use feature qw{ say };

use Lingua::EN::Numbers qw{ num2en };

my $text = 'abc No. 347 xyz';

$text =~ s/No\. \K(\d+)/join "", "\\", map num2en($_), split m{}, $1/g
+e;

print $text;  # abc No. \threefourseven xyz
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I used /e which evaluates the replacement part as code. The regex matches "No. " followed by a number, but replaces just the number due to \K. It splits the number into digits, replaces each with the word (via num2en) and joins them together with a \ at the beginning.