The worldbuilding just didn't capture the imagination, like say Star Wars or Harry Potter did. Moviegoers wanted to go to Pandora, yes, but the fictional universe just wasn't constructed for longevity's sake.
In Star Wars there were tons of interesting planets in the galaxy, with an endless supply of side characters whose lives could be expanded upon in supplementary books, comics, t.v. shows, or video games. There were Jedi, Sith, bounty hunters, commando troops, rebel forces, imperial loyalists, all whose lives could be explored.
Harry Potter had tons of characters, with interesting back stories, and a whole wizarding world that had barely been touched upon but could easily become many different series upon themselves. J.K. Rowling could write a book series on the lives and adventures of another group of students in Beauxbaton's Academy or the Durmstrang Institute and they would be instant best sellers. Upcoming movies focus just on the caretakers of magical creatures, and people will go just for that. People want to escapism of imaging their lives as a witch or wizard, and fans are dying for more material.
Avatar lacked most all of this. There were no distant worlds hinted at, no real mystery behind anything, you didn't care too much about the back histories of any of the characters. The primary reason it's been forgotten is because nothing can be really built off it. And even if it could be, that's not really James Cameron's style. He doesn't do the small world building projects, he goes for the big movie every 7 years or so. In comparison J.K. Rowling still does her additional Pottermore material often enough, and George Lucas was never shy about licensing a cash in opportunity.