There's plenty to do outside the latest expansion, I really don't know how you'd propose they do any better either. They don't just release a new expansion and do nothing until the next (usually. It has happened, this current cycle has been great though) they make content for 2 years between expansions. I think that WoWs method is honestly the best one. People love to talk about how wonderful FF14 is and it's the same thing. Most the most well liked MMOs use this method for a reason.

There are exceptions like Warframe which uses their platinum market to find the game through people willing to pay to win and supporting people who farm the materials people can buy with their Platinum. Guild Wars avoided this issue by making the patches between expansions their own smaller expansions with their own price tag. Both these games, while being great games, have far more extensive mtx shops than WoW or FF14 do as a result, though.