Mandelson believes victory possible
Relying on Labour's traditional supporters to win the 2015 general election would be "an act of great self-destruction", Lord Mandelson said in an appeal for the party to widen its appeal if it is to win back power.
The former cabinet minister - who helped steer the party to a landslide win in 1997 - said he no longer believed it was doomed to a second term of opposition as there was a "growing and quite profound public disquiet" about the impact of planned Tory spending cuts.
But he said the "huge swathe" of voters yet to make up their minds how to vote in May were moderates who were looking for "policies that are aspirational and not motivated by envy or resentment of those who are better off".
Speaking at the Westminster launch of a booklet published by the Policy Network centre-left thinktank, he said: "I don't want to count our chickens but last week's Autumn Statement, while OK for the Tories in its immediate impact, at the same time set off alarm bells in the public mind about the longer term and the direction that the country is taking.
"Labour's chance is to cement this ... into the pre-election narrative that we have to put together in order to get ourselves into a different and better place politically, if we are going to be in a position to do well and to emerge from the next election as the largest party."
He went on: "The temptation for Labour is to concentrate on the fairness and social justice dimension but in my view the implications for our longer-term economic capabilities in this country, on which future social justice hangs, are just as great and both need to be emphasised - the economic as well as the social justice - if we are going to make the impact we need to do on voters who have not yet made up their minds."
The former heavyweight admitted that he previously doubted Labour could win in 2015.
"I am really not sure that is the case now," he said.
"There is a growing and quite profound public disquiet about where we are heading and where the country is going to end up socially and economically if we continue along the course that they have set."
Voters did not like the fact that the Tories appeared to be making cuts "with too much ideological relish".
"This is not where mainstream voters are."
But he said Labour could only win them over - at a time when public anger with traditional parties meant 2015 could be a "six-horse race" - by putting together " alliances of voters from different parts of the spectrum and of the country.
"No party that wants to win power at the next election can afford to consign or just simply not bother with groups of voters in different parts of the country.
"To my mind that would be an act of great self-destruction," he said.
He went on: "There is no point just talking to Labour voters because, put simply, there are not enough of them for us to win an election.
"I believe that our message can be got across to a wider constituency than the one we have at the moment and I do believe that the Conservatives can be beaten at the next election."
The undecideds were "defined by their moderate, progressive thinking rather than how well off" they were, he suggested.
"They don't like the polarisation of politics between rich and poor.
"They want a fairer, less unequal society, and they also realise that this must be paid for.
"But they also want policies that are aspirational and not motivated by envy or resentment of those who are better off.
"They want workers to be treated fairly in their pay and their conditions but what they don't like is a sort of 'them and us' approach to politics where you are being forced to make a choice: for the bosses or for the workers."
And they "do not confuse the importance of protecting people with the protectionism of economies and markets".
They knew the solution to the country's deep problems was "not about trying to turn the clock back to an era they know is behind us".
"Without being apocalyptic about our chances ... we have to think a hell of a lot more deeply and in a more long-term than perhaps we have ever needed to do in the run-up to a general election," he concluded.