Brand vs. Basis Points: Why Trust Beats Cost in ETFs
The Wrong Debate
In ETF circles, the debate usually comes down to basis points. Who’s cheaper? Who has the most efficient index tracking? Who’s innovating with wrappers or themes?
But here’s the uncomfortable truth: none of those things matter if investors don’t trust your brand.
Flows don’t always follow the cheapest product. They follow the name people already believe in.
The Reality Check
Take a step back and ask yourself: when an advisor or retail investor allocates capital, what’s really driving the decision?
- They want exposure to an index.
- They want confidence that they won’t be embarrassed in front of their client.
- And most importantly—they want a name they can stand behind.
This is why iShares, Vanguard, and a small handful of issuers dominate. Their products aren’t always the cheapest or the most innovative. But they own investor trust.
Brand is the Shortcut
Humans rely on shortcuts. Faced with thousands of ETFs, investors don’t weigh every option. They default to the familiar.
iShares = safe.
Vanguard = low cost.
SPDR = first mover.
That brand familiarity acts as a mental filter. Even if a competitor has a compelling product, it rarely wins if the brand isn’t top of mind.
The brand is the moat.
Where Issuers Go Wrong
Here’s the paradox: most ETF issuers know this, but act like it isn’t true. They keep pouring resources into launches and sales while leaving branding underfunded and underdeveloped.
The result?
- A clutter of undifferentiated product announcements.
- Dense white papers no one reads.
- Webinars with single-digit attendance.
- Social media accounts that are little more than compliance checkboxes.
Meanwhile, digitally native investors are learning about ETFs through Instagram reels, YouTube explainers, and finfluencers.
And most issuers? They’re not even in the conversation.
The Old Playbook Doesn’t Work
Financial marketing used to be about three things: brochures, conferences, and press releases. That was enough when distribution was tightly controlled by wirehouses and platforms.
But the market has shifted. Distribution is more fragmented. Investors are younger, more digital, and more self-directed. Conversations about ETFs happen on TikTok and X, not in hotel ballrooms.
If your brand strategy still looks like it did in 2010, you’re already behind.
What a Modern ETF Brand Looks Like
So what does effective branding look like today?
- Clear Narrative. One sentence that explains why your ETFs exist and why investors should trust them.
- Digital-First Content. Platform-native posts, short videos, and simple visuals—not PDFs buried on a website.
- Human Leadership. PMs and executives showing up on camera, sharing insights in plain language.
- Partnerships with Trusted Voices. Collaborating with credible educators, influencers, or platforms where investors already spend time.
Consistency. Not bursts around product launches, but a drumbeat of regular content that builds familiarity over time.
Brand Before Product
The temptation is always to chase the next theme—AI, crypto, carbon credits. But unless those products tie into a long-term brand strategy, they often fizzle.
Investors don’t want novelty for novelty’s sake. They want to know the issuer behind the fund has a clear, enduring identity.
The priority for issuers should be simple: brand first, product second.
Why This Matters Now
ETF adoption is accelerating across retail channels. Younger investors, in particular, are shaping their decisions through digital media.
If your brand isn’t present in the digital spaces where those investors are learning, you’re invisible. And invisibility is the fastest path to irrelevance.
On the flip side, issuers who do invest in brand are building something that compounds. Trust, once earned, makes every future product launch easier.
It’s no accident that iShares funds often win flows before competitors even make their pitch. The brand carries them halfway to the close.
The Bottom Line
Cost, performance, and innovation matter. But they’re table stakes.
The deciding factor—the reason some issuers dominate while others remain footnotes—is brand.
Because at the end of the day: Products can be copied. Brands can’t.
At Blackwater, we work with ETF issuers who want to move beyond product-first thinking and build brands worth trusting. If that sounds like the future you want to build, let’s talk.
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Get in touch today.
