I use a cheap leather thing attached to a 1 1/2" split O-ring. The leather used to have a BMW roundel glued on it that fell off on some highway a few years ago. I got it in 2004 when I bought a used 2003 R1150R, and the owner said keep the ring. On the O-ring I have two other keys. One is for my Micatech Pilot cases, and the other is for a Master lock for when I lock my bike with a cable.
I've never thought of replacing it. Its either in my left front pocket, my bathroom counter at home, or a bed stand in a hotel room when I'm on the road.
BTW, my spare key is on a plain split O-ring along with the spare for the panniers and the Master lock.