Is it possible not to have spent any money on paid advertising at all? Do you think these are the result of word-of-mouth, or very good content marketing?
It's absolutely possible to get customers / clients without doing any paid advertising.
As you suggested - this can be from word of mouth or from a variety of other sources.
Effective marketing plans often utilize a broad spectrum of both inbound and outbound strategies. And some business models lend themselves incredibly well to methods that involve little or no money. Other strategies / techniques / platforms require a bigger investment. (Notice I used the word "investment" not "spending")
In my opinion, the key is to create a business model that allows you to maximize your return on investment (ROI) for all of your marketing (and quite frankly just ALL) dollars.
For guidance on how to create such a business model - give me a call.
In all likelihood, these folks are defining "advertising" as paid promotional efforts. With so many tools at our disposal for doing organic (non-paid) marketing, many companies are able to get off the ground and start seeing success by focusing their efforts on these organic channels (email marketing, blogging, SEO, social media, website optimization, lead nurturing, etc).
By leveraging these inbound marketing channels, building out a strong content strategy, and developing a strong and diversified online presence, you should be able to get your business in front of many new audiences, without having to pay for banner ad placements and Adwords campaigns.
As the manager of the paid marketing channel for an inbound marketing company, one of my most important endeavors is finding ways to scale back our advertising spend and help increase our yield of new leads and customers from our organic channels. I'd be happy to discuss organic vs. paid strategy with you greater detail if you want to hop on a call.
David brings up a great point. You are INVESTING in something -- relationships, great design, strategy, content, etc...
There is no such thing as a 'FREE' customer. You have to spend money to land that customer. You might spend that money on advertising or on a better content marketing team.
Don't expect big results with little investment. It's going to cost you.