Step 1: After Creating a Blog with blogger.com click the blog you want to set your domain on.
Step 2: You would see a screen Below. Now click on the "Setting" Tab in the Left Bottom.
Step 3: Click On "Set up a Third Party URL for your blog".
Step 4: Fill out the Domain You Have Already Registered From Domain Name Provider such as eg: Godaddy.com or Namecheap.com and click on "Save".
Step 5: You would see the screen with the CNAME details as shown. Now enter these details in your Domain provider like godaddy.com DNS Zone file. Save changes your details there.
Step 6: Now finally click on the "Save" button as shown and the process completes.
Step 7: Click on "View Blog" on the top to Check the Domain is Live.
Step 8: A Final step to redirect your domain eg: demo.com to www.demo.com. Goto Step 2 and click on "Settings" tab again and click on "Edit" next to your domain name.
Step 9: Tick on the Option "Redirect demo.com to www.demo.com" & click on "Save" again.
Congrats on learning How to Set up Your Domain on Blogger which is now hosted on google servers for free for life!