Once you have selected an agency you need to have a fair and realistic way of monitoring their effectiveness for you. While there may be a variety of ways, here is what I like to have the client do:
(a) First draw a simple graph showing quarterly sales for the past several years, (I like to go back five years, you decide what is appropriate for you). This provides a visual benchmark of past company performance, whether that performance is up, down, or flat.
(b) Then using standard regression analysis determine the projected sales for each of the next eight quarters. Now you have an estimate of what sales might have been if you hadn't done anything, a baseline; this is what you are going to measure the agencies effectiveness against.
(c) Each quarter plot actual sales on the graph. Compare the relationship between actual sales and your baseline projections. While you may not see anything the first quarter, or maybe even the second, you should start to see a change in sales by the end of the third quarter. Advertising takes time to work, don't expect sales to instantly shoot through the roof. Advertising, like a garden, takes a lot of time and attention before you start to see anything happen, and even longer to fully appreciate the benefits of all the work. It will come, be patient.
The value of this method is that it gives both the client and the agency a reference point from which to work. It shouldn't have created unrealistic expectations, and it is quantifiable.
Some agencies may argue against such a measure as unfair, they are unaccustomed being held so liable for their actions. For the most part I like it. Sales is an easily determinable number, and something both of us can relate to. I want the client to know - without a doubt - that I am doing a good job for them, and this is a way for me to prove it. If the marketing isn't working, then both of us need to know that so we can determine what is wrong - it may or may not be the fault of the agency. At least that way changes can be implemented in a fairly timely basis.
Understand that sometimes the problem is not the agency's fault.
If they are getting customers in the door, but the sales force isn't closing, then the problem is either your sales force or your marketing mix. Be sure you have correctly identified the problem before yelling at the agency representative.
Marketing is not an exact science and sometimes the best laid plans simply fall flat. That's why you are constantly monitoring your results - so you can make adjustments quickly.