The only way this works is you make your products obviously better in terms of price/performance in the segments you compete in. You've sacrificed the effect of a halo tier product on mindshare to your competitor, so your value proposition has to completely undermine nVidia.
However, nVidia has a very big war chests. They could give the 50xx cards away for free and not really care, as long as it got rid of the opposition.
Polaris remains one of the most popular AMD dGPUs to this day.
That's not a high bar. AMD haven't really had a big hit GPU since they shifted to GCN. RDNA was looking to be revival, but hasn't really been competitive enough to shift the consumer mindset.
They don't seem to be capable of competing on high-end, so refocusing on different market segments makes sense. They did the same with CPUs until Ryzen.
It's always cyclical, because they always get complacent when they manage to take over high-end market share. Their GPU's are good, and the lower prices keep them relevant, but on the top end they lose in all aspects except aforementioned price at the moment. Which is clearly not enough to create any real market share.