The Dems should definitely move more central on social issues, as the US election system has a huge built in rural bias.
Then focus on more broad-reaching progressive economic topics. Less focus on legislation targeting specific marginalized groups and more on policies which would impact everyone directly. As a potential example, Universal Basic Income (“Freedom Bonus” or whatever it was called) was one such policy which was floated a couple elections ago.
To be fair, before Trump took over the party, the Republicans were generally considered to be in a death spiral.
The prevailing idea was that the party just didn’t have a future. Their brand was this basically an unappealing mix of boring religious people and self-professed ‘sensible’, common-sense stewards of the status quo. Looking at demographic trends at the time, they were trending towards irrelevance.
Then Trump took over and brought back the enthusiasm. They also started to court minority votes (Hispanics, Blacks) which tend to be very socially conservative. At the same time, the democrats slipped into the ‘boring status quo protectors’ role.
Hopefully the Dems wake up, but it might take a while.