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Application Insights is the recommended option for notifying users when transaction response time goals are not met in Azure. This powerful monitoring tool is designed to provide insights into the performance of your applications. It not only tracks response times but also allows you to set specific performance thresholds and configure alerts for any deviations from these benchmarks.

When using Application Insights, you can create alerts based on a variety of metrics, including request performance. This means you can notify users when the application's transaction response times exceed the predefined goals, thus ensuring you maintain a high-quality user experience. Additionally, Application Insights provides detailed telemetry data, which can help in diagnosing issues and optimizing app performance further.

While Service Fabric Health Reports can provide insights into the health of services hosted on Azure Service Fabric, they are not specifically tailored for notifying users about transaction performance across applications. The Cloud Monitoring Dashboard offers visualization of metrics but lacks the alerting capabilities focused on application performance. Azure Activity Logs mainly track operations and changes to the Azure resources rather than the application-specific performance metrics that Application Insights addresses.