I'm doing this too. My PuppyBoy is ten months now and I know it's working because I'm only buying a package of hotdogs once every 2 and half or even three weeks, instead of every week.
Several times lately when passing a yard where the dog is contantly out, barking, running along it's fence beside us and being a huge distraction my boy has immediately looked to me before I even asked. I am now treating every second or third "watch me" but in the situation of the barking dog I still treat every time.
The goal, for me anyway, is to have him NOT watching me. I want him to walk on leash beside me and know what he is supposed to do without constant checking with me. We're getting there.
One tip: Remember to give your pooch big SMILEs when he looks at you. OUr trainer said most dogs recognize human smiles and know that they are good. Treat sporadically, SMILE always.