PPC Pricing Model

I’m trying to determine the best way to bill b2b clients for PPC management. Here are a few models I’m considering:

• Percentage Model: percentage of total spend goes to agency
  • Traditional agency model n
  • no economies of scale
  • difficult to discuss cpc without transparent mark-up
• Per Keyword Phrase
  • $X/month/keyword
• Hourly Rate
• Pay Per Performance
  • Googles PPA is only available on Content Network- not very useful for b2b, niche clients such as ours
  • need to establish metrics/value of conversions – may not cover actual cost of managing

Anyone have any thoughts?