I don't think you will get customers to ditch the competitors product they are already using for yours unless these extra features are a game changer for the customer. If you cut features and just work on what you need to be on par with the competitor you will just be a little later to market, and you can continue working on the remaining features. If you wait to finish your extra features, the competition will already be picking up those customers you could of had if you released early. Ultimately it depends on if those features are something you consider to be at the core of your business, if they are then maybe you are right.

What's so wrong in releasing a base product that is comparable to your competitor's first? Then add the differentiating features as you complete them. Releasing these new features will be good for PR/marketing too.