Pei Wei takes shots at giant Panda Express in turnaround

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Pei Wei is picking a food fight with restaurant giant Panda Express.

The small chain is making big changes after six consecutive years of declining sales and traffic. Last year, Pei Wei hired a new CEO, John "J." Hedrick, and a new chief marketing officer, Brandon Solano. It also split from P.F. Chang's, the more upscale Asian dining chain that gave fast-casual Pei Wei its start in 2000.

Now, Pei Wei has started what Solano calls a turnaround, an effort that includes speaking through a new tiger character that takes aim at Panda Express. The talking tiger appears alongside a talking panda in a commercial that runs online and has aired in markets including Dallas and Phoenix.

If a talking panda sounds familiar, that's because Panda Express used the tactic a few years ago, in work from the same creative agency, Siltanen & Partners, that is now Pei Wei's creative agency:

Pei Wei started by going after Orange Chicken, a major hit for Panda Express, with the March introduction of Wei Better Orange Chicken. The early work gives Pei Wei a way to highlight how its food prep, such as using fresh chicken that's cut and battered in restaurants daily, differs from what it suggests other chains do, which is to use frozen chicken that sits out for a while.

"As a brand, we weren't very focused on our customers and we weren't very focused on our competition. We were rather inward looking," says Solano. "I don't think we're going after Panda, I think we're going after their customers."

Traffic in Pei Wei's restaurants started to increase, Solano says, almost immediately after the campaign began running. He declined to share recent sales trends.

Panda Express, the market leader and self-proclaimed "home of American Chinese food," shrugs off any potential concerns over its much smaller competitor's new product, saying it is "humbled by the guest love for our Original Orange Chicken." After all, 285,000 people order it every day, Panda Express says, and more than 70 million pounds of the slightly sweet, slightly spicy dish is served at its restaurants annually.

A big gap

Pei Wei, with roughly 200 restaurants, would have a long, long, long way to go to catch up to Panda Express. In 2017, Pei Wei's sales fell 8 percent to roughly $319.2 million and traffic fell 10 percent, according to NPD Group/Crest data provided by Pei Wei. It's roughly one-tenth the size of Panda Express, which had 2017 sales exceeding $3 billion from more than 2,000 restaurants.

Solano, at least, has experience in turnarounds. His six years at Domino's included working on a new pizza recipe and even starring as its head chef in its overhaul campaign. Later, at Wendy's, where he was senior VP of marketing and then CMO, he helped come up with and test the 4 for $4 value offer that chain has used to much success since 2015.

"We have less resources than our competition, for sure, so we must be scrappy," Solano says of Pei Wei. "Would I like to have Wendy's budget back? Hell yes, I would. But I would tell you for the size of our business we have the resources to hire an amazing agency roster."

Pei Wei did not do a broad review before selecting Siltanen & Partners as its creative agency, first on a project basis and later as its agency of record.

"I think the work that they did for Panda was very strong," says Solano.

The similarity was intentional, says Rob Siltanen, Siltanen & Partners' founder and chief creative officer. "We saw a ton of success with the brand through making the most of the panda," Siltanen notes of his agency's past work on Panda Express. The agency declined to participate after the Panda Express account went up for review. Fast forward a few years, and Siltanen helped Pei Wei come up with the tiger to go head-to-head against the panda.

"Creating the most effective campaign for our existing clients is what we're always about and I simply felt this was the most effective tool we could possibly do," Siltanen says.

Solano, who says he always tests ads that he works on, calls the Pei Wei ad "killer" and "the best work I've done since I left Domino's."

The tiger replaced the so-called "noodle man" in Pei Wei's logo and is starting to pop up on signs and packaging. It also started tweeting in February. The character's account, which was recently verified, has a small but growing number of followers.

"Social media is a fantastic invention for smaller brands," says Solano.

So, would Solano take the tiger up against his former company, Wendy's, which has become known for its social media efforts?

"That would be a fun Twitter exchange, for sure," he says.

Panda Express, which worked with Bailey Lauerman after Siltanen and picked Wolfgang as its latest creative agency this year, didn't comment by press time on its own creative plans.

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