Microsoft counts on hip-hop duo to raise a rush for first isle store

Microsoft will open its first store in Hawaii today at 11 a.m. at Ala Moana Center.

The Redmond, Wash., software company has opened more than 36 stores across the United States and Canada in an effort to cultivate a total Microsoft lifestyle.

For that lifestyle to take hold, Microsoft needs buzz.

That’s where the Microsoft store comes in, offering workshops, meeting space, community outreach and, of course, the latest gadgets.

To get things going in Honolulu, Microsoft is handing out at least 2,700 tickets at the store for a free concert this evening, featuring Macklemore & Ryan Lewis. Gates open at 4 p.m. at Kakaako Waterfront Park. Their act will be followed by the alternative dance band Neon Trees.

Macklemore & Ryan Lewis’ hit song, "Thrift Shop," has garnered more than 340 million views on YouTube and reached No. 1 on the Billboard Hot 100 chart.

Jeff Green, president of Phoenix-based retail consulting firm Jeff Green Partners, estimates each Microsoft store generates an average of $1,500 in annual revenue per square foot. That’s two to three times the average revenue of other mall tenants, Green said, but it’s also three-quarters less than the average Apple store.

Whether the Microsoft stores can convert buzz into sales, however, remains to be seen.

According to IDC data, shipments of Microsoft’s Surface RT tablet lagged behind expectations after its October 2012 launch. Microsoft’s share of the tablet market didn’t get much bigger in the first quarter of 2013, either, even with the release of the Surface Pro in February.

"It hasn’t been a failure, but it hasn’t lit the world on fire," Edward Jones technology analyst Josh Olson said of Microsoft’s mobile debut.

Still, with his eye on future products in the pipeline, Olson maintains a buy rating on the stock, which has gained 31 percent this year.

Microsoft hasn’t released hard numbers from its retail sector, but if market performance is any indicator, "stores haven’t helped that much," Olson said.

Apple, by contrast, posted sales of almost $19 billion from its retail segment in fiscal year 2012. It has 406 stores worldwide.

Microsoft acknowledged in May that it overshot the tablet market in price.

The Surface Pro and RT start at $899 and $499, respectively, but tablet options as low as $449 will be available, said Mark Frederickson, manager of a St. Louis store that opened earlier this month.

Olson expects that price to fall even lower.

For coverage of the Microsoft store opening, see www.staradvertiser.com.

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The St. Louis Post-Dispatch contributed to this story.