Price is the amount by which customers pays for the value of any offer from retailers and they

use it to make choices between competing brands (Rosa et al., 2011). Price is also one of the
most flexible elements of the marketing mix (four P’s) and can be adapted easily in the
changing environmental conditions (Lancioni, 2005). Studies have shown price as an important
factor in purchase decision, especially for frequently purchased products, affecting choices for
store, product and brand (Rondan, 2004). Organizations spend a lot of time and resources
figuring out the best pricing strategy for their products because a wrong strategy can cost them
important customers and therefore result into loss of revenue. Organizations staying to be
indifferent or frustrated around pricing strategies remain behind by letting the competition to
set market prices (Dolan & Simon, 1996). This may have to result negatively on how the
consumers view them because they have to go by the prices fixed by their competitors
otherwise their market share will have a negative impact. As Dolan & Simon (1996) affirm, price
therefore turns into a competition for the goal of its market share and its relation to the
consumer decision.

Consumer purchase decision is the study of how individual customers, groups or organizations
select, buy, use, and dispose goods and services to satisfy their needs and wants (Peter &
Donnelly, 2003). It refers to the actions of the consumers in the marketplace and the underlying
motives for those actions. Consumer purchase decision portraits an individual who buys goods
and services for their own needs (Kotler). As for (Peter and Olson 1993), this is simply an
interaction between a person’s mood, feelings and affections. Organizations expect that by
understanding what causes the consumers to buy goods and services, they will be able to
determine the best price for their products, the price that will make them have a competitive
edge over their rivals. Consumer purchase decision have various factors that can affects such as
personal factors like income level, age, gender, and education. And they included the marketing
factors such as product design, price, promotion, packaging, position and distribution (Tang et
al., 2001). Kotler (2001) suggest that product choice, brand choice, dealer choice, purchase
timing, and purchase amount are also the factors that influences the consumer purchase
decision.

Many studies have tried to have a deeper knowledge prior to the relationship between price
and consumer purchase decision, concluding that product pricing is a complex matter and that
there are many strategies that influence consumer perceptions and purchase intentions (Alba
et al., 1994; Chandrashekara et al., 2003; Hardesty et al., 2003; Hildalgo et al., 2008; Manzur et
al., 2011).