I think private music teachers are now at an advantage, especially in towns with a fairly well-educated population. With the buzz about such books as The Mozart Effect and supportive articles in respected periodicals as Newsweek and Parade , more and more people are seeing the benefits of private music instruction for their children. Besides, there's always those high-school kids who want an edge on the all-state band competitions or district music festivals!
So, how do you let people know you exist? The first and best step is to make yourself visible. Volunteer to play for church services (often, churches will pay you if you don't have a membership with them), or seek out elementary music teachers and offer to demonstrate for their classes during the section on woodwind instruments. Often, when I first volunteered to play for church, the first question I'd get was "Do you give lessons?" Most of the time, of course, it was about piano, but then I could throw it in that I taught flute, too. Those people may not have a child who plays flute, but they often had friends who did! I gained a couple of students that way.
Go ahead a put in a newspaper ad. I did that, but again, the area in which I live isn't all that large, so my ad wasn't hidden in the middle of several others advertising the same thing. If you live in a larger area, consider putting an ad in suburban papers rather than the larger metropolitan papers, unless you're willing to shell out extra for a stand-out box ad. And yes, I would get at least two calls for just about every ad I would put in.
Use your computer and make up nifty posters for band directors to post on their bulletin boards. You better believe that most band directors would jump at the chance to encourage as many of their students as possible to study privately. Depending where you live, make enough for schools within a 20 to 50 mile radius. I make enough for schools within 15 miles, because St. Louis is so close. Again, you have to consider the "competition." But then, it doesn't really cost anything but the price of gas or a stamp to send it out farther.
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