Ragsthe? It's not really helpful, or reflective of reality to say were a small c nation and a genuinely socialist party would have no chance! Simply because - whilst that might be what you and many others are, many others are not. Many of us are left-wing and yearn for a credible alternative to the Tories programme of austerity, privatisation and militarism, yet feel betrayed by The Labour Party, who I think, has only itself to blame.
Many people such as: Blair & Mandelson might agree with you that Labour should return to Blair’s strategy of winning over Conservative voters. But I believe the really big hit it took was that genuinely left-wing voters deserted it because they already view it as Conservative 'light'. (Also, don't forget almost one-third of the electorate saw no point in voting at all because no party has anything to offer them).
For me, Miliband’s minuscule step to the left was pathetic, coming from a party that was committed to austerity and just about everything else the Tories are pledged to. As well as it's history of Blair and Brown, the tools of big business and architects of the Iraq war.
Labour’s most significant losses came in Scotland. The SNP preyed on class anger against Labour and turned in a nationalist direction. This, I think, is what gave the Conservatives their success. By whipping-up nationalism, that spread over the border, (they also helped UKIP make inroads into Labour’s former strongholds as well). I believe they sowed divisions in the working class vote and attacked Labour for its defence of the Union.
That said, if Labour can't even beat the Tories who have already pledged billions of pounds in additional cuts and to rush through a new “snoopers charter” to strengthen the powers of the state and security apparatuses. They'll seek to step up nationalist tensions also, not only in the UK, but on the issues of immigration and Europe, then it's time to look at forming a new party IMO. One that can not only defend its socialist political aims against the inevitable, ideological offensive that will be launched against it by the establishment. But also can advance its socialist programme against capitalism, which is the root cause of austerity and war.