The exchange-traded fund industry has grown immensely over the past decade. With U.S. ETF assets having hit the $1.5 trillion milestone earlier this year, investors clearly like the flexibility and other advantages that ETFs offer.

But one company has done a far better job than its peers in attracting ETF assets. Morningstar recently found that Vanguard has pulled in 40% of all money flowing into ETFs so far in 2013, gaining market share at the expense of larger rivals State Street (NYSE:STT) and BlackRock (NYSE:BLK).

Vanguard's big selling point
Morningstar's figures show that Vanguard has pulled in $36.6 billion in assets year to date, more than doubling the inflows of BlackRock's iShares ETF line. State Street's SPDR line has actually lost a substantial amount of assets in 2013, with year-to-date outflows of $15.6 billion.

Vanguard's success in attracting assets reflects greater awareness among investors of the impact of costs on returns. A recent advertising campaign highlighted Vanguard's unusual corporate structure, which has fund shareholders acting as owners of the fund company as a whole. The difference between Vanguard's structure and those of BlackRock and State Street is similar to the difference between a mutual insurance company, which is owned by policyholders, and a traditional shareholder-owned insurer. Vanguard argues that its structure helps it offer its funds at cost, resulting in much lower expenses in many cases than its competitors.

Vanguard has also benefited from offering its ETFs at no commission to its brokerage clients. Lacking brokerage outlets of their own, State Street and BlackRock don't have this advantage, although BlackRock's arrangement with Fidelity to offer certain iShares ETFs at no commission has undoubtedly helped it attract assets as well.

Other winners
Vanguard isn't the only ETF company boosting its market share. Schwab (NYSE:SCHW) has done a reasonably good job of attracting assets as well, seeing $4 billion in positive net flows into ETFs. The company has used a cost-conscious policy similar to Vanguard's, actually undercutting Vanguard's ETFs with even lower expense ratios for many of Schwab's funds.

Also, WisdomTree (NASDAQ:WETF) has substantially increased its presence in the ETF market with about $11.3 billion in positive fund flows. WisdomTree's main focus isn't on cost containment, but rather on innovative indexing techniques that stress fundamental weighting factors like dividends and earnings, rather than market capitalization. With many of the top ETF providers competing with nearly identical products, WisdomTree's offerings are often uniquely tailored to deliver different types of investment exposure. In fact, WisdomTree has gotten so popular that Schwab recently followed suit with some fundamental-based ETFs of its own.

Be ETF-smart
If you like ETFs, it's important to keep competitive advantages across different providers in mind when choosing specific funds. Otherwise, you could end up paying more than you need to for the investment exposure you want.

Fool contributor Dan Caplinger has no position in any stocks mentioned. You can follow him on Twitter @DanCaplinger. The Motley Fool recommends BlackRock and WisdomTree Investments. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.