I don't think anything necessarily went wrong so much as there probably wasn't anything major planned for him in the first place.
Even when Cesaro won the first Andre the Giant Memorial Battle Royal, I can honestly say that I didn't expect anything to come of it because I knew from the beginning what the battle royal was really all about: a means of getting most of the male wrestlers on the roster onto the WrestleMania card so they could have a share of the biggest payday of the year. I didn't picture Cesaro rising through the ranks on his way to being a main eventer because it's obvious that when you look back on things, Vince just isn't interested or doesn't know what to do with him. During Vince's infamous podcast interview with Stone Cold Steve Austin, he all but through the WWE roster under the bus by not taking any responsibility for any problems plaguing WWE's creative process and pushing wrestlers, even though the buck ultimately stops with him because of his micromanaging style of having to be in direct control, and he especially mentioned Cesaro during his "brass ring" comment.
Vince can be a really weird cat when you actually stop to think about it. Cesaro is a unique talent, genuinely one of the most consistently high quality in-ring talents in WWE over the last decade, is freakishly strong, deceptively athletic, can wrestle just about any style comfortably and can pull good matches out of limited wrestlers; you'd think he'd be someone that a promoter would look at and say "I think this guy brings a lot to the table and I want to try doing something with him" but that hasn't really happened when it comes to Vince and Cesaro. When you add everything up, it only makes it all the more odd that Vince put the WWE Championship on Jinder Mahal when someone like Cesaro, who hasn't gotten the time of day from Vince, is simply a much better pro wrestler. I'm not saying that to necessarily bash Jinder, I'm willing to give him some time before I condemn or accept his push, but I'm of the opinion that Cesaro is just vastly more talented.
"What Do I Know Of Cultured Ways, The Gilt, The Craft And The Lie?
I, Who Was Born In A Naked Land And Bred In The Open Sky.
The Subtle Tongue, The Sophist Guile, They Fail When The Broadswords Sing.
Rush In And Die Dogs - I Was A Man Before I Was King."
Conan Of Cimmeria