Not everyone has a large network of business contacts they can solicit. If you're working from home and have most of your friends and business contacts already signed up then who else is there? Also taking time to meet a client in person and discuss hosting options might not be worth the $10 a month they're paying you.

Seek more targeted groups depending on what your goals are. Eg: Flash developers. Usually web developers will have a heavy say to the company they work for as to where to host the site or series of sites. Make nice with some developers and business will come. Offer some incentives to get them in the door and keep them happy.

Trying to buy advertising on WHT or adwords for hosting are a waste of time and money if you're a small business IMO. Think about offering an affiliate program for the loyal ones who keep sending you clients, they'll push harder to sell your products when there's something in it for them. Soon you'll have a few free sales people giving you more time to focus on strategies and creative marketing ideas to keep clients happy and coming in.

Happy clients will refer more new ones. Don't always assume you need to go outside of the box to find new customers. Maybe get more in touch with your current clients and see if they'd recommend your services. Having a happy customer recommend your services over a crappy banner ad is 1000x as effective.

Lets be honest here. Web hosting is the same as selling bottled water when it comes down to it. The services are virtually identical. Some companies are very creative in the type of bottled water they sell. How creative you are with marketing plays a huge role in your businesses success. Seeming like you have something different or special when its really just the same is key. Go to your grocery store and look at all the different packaging on bottled water, kind of silly but you'll be shocked which ones make you think you're thirsty. The same things goes for this stupid "Energy Drink" craze. Who the heck in their right mind pays $2.50-3.00 for a drink that's smaller than a can of coke? It's nothing but sugar water, like Coolaid but I see TONS of people spending their hard earned bucks like an addiction. The image of the product is crutial. what image are you trying to give?