If you send me a mail using the contact form on this site, the mail is not handled by my web hosting provider Bluehost. Rather, Google handles all my mail.
Using Google Apps Standard Edition allows you to map certain Google services like Gmail, Google Docs, Google Spreadsheet, and Google Calendar to your own domain.

For example, you can have a yourname@yourdomain.com email ID  instead of yourname@gmail.com, and the mail you receive at your ID can be managed from the Gmail interface.

Why should you use Google Apps ?

Some of the advantages of using Google Apps Standard Edition for your domain are as follows :

1. You can create up to 100 user accounts for your domain. Free of cost.
2. If you are running your website on a shared hosting plan, this is a very cheap (read free) way of removing excess load on the server by letting google manage the email traffic.
3. You can collaborate with your colleagues and business associates in a secure way using HTTPS instead of HTTP using Google docs, Google spreadsheets and Google presentations.

Steps to setup Google Apps for your Domain

1. Register for Google Apps

Register for Google Apps Standard Edition account at http://www.google.com/apps/intl/en/group/index.html (It’s free).

2. Create user accounts

Create user accounts for your Google Apps standard edition. Google allows you to create up to 100 user accounts.

These are more than enough for a person or small business. If you need more user accounts, you can always upgrade to a premier edition of Google Apps for a nominal yearly fee of $50.

3. Verify ownership of your domain

After you have created the user accounts, Google asks you to verify that you are the true owner of the domain. Visit https://www.google.com/a/cpanel/linuxandfriends.com/VerifyOwnership and verify ownership of your domain. In the link listed above, make sure you change linuxandfriends.com to the name of your domain.

You can verify in two ways -

1. By uploading an HTML file to your domain’s root folder or
2. By changing your CNAME record.

Usually your web host will not allow you to change the CNAME record by yourself. You will most probably have to contact support or open a support ticket to get that done. An easier way is to upload an HTML file.

Once you do that, return to the verify ownership page and click on the “Verify” button. Google will now check domain ownership which might take anywhere from a few minutes to 48 hours. So sit tight.

4. Set Google Apps as your primary mail exchanger

Now you have to change the MX records at your web host.

To setup MX instructions visit this page [ https://www.google.com/a/cpanel/linuxandfriends.com/SetupMXInstructions ] for the specific instructions related to your web host / registrar. Again, change linuxandfriends.com in the preceeding link to your domain name.

If your web host / registrar is not listed in the dropdown list and if you are managing your website using cpanel, you can choose cpanel in the drop down list and follow the instructions listed there.

Put in a nutshell, you should have the following MX records at your web host account.

Please Note: It is a good thing to have different priorities for all the MX server addresses. This is because having the same priority will cause confusion within the DNS records.

These are the values I entered in my webhost account MX records – 0, 10, 20, 30, 31, 32, 33. If you have an MX record pointing to your own domain then delete it. These are my current MX entries as seen within my Bluehost Cpanel.

Once you change the MX records in your web host/ domain registrar, come back to this page [ https://www.google.com/a/cpanel/linuxandfriends.com/SetupMXInstructions ] and click on the button “I have completed these steps”. (Don’t forget to change linuxandfriends.com in the preceeding link to your domain name).

This completes the task of making Google Apps your primary mail exchanger.

End Note

Now you can start creating custom email addresses for all your colleagues / employees / users and they can access all Google’s applications mapped to your domain.

Suppose your user base grows to more than 100, you can upgrade to the paid Google Apps premier edition for $50/year. This allows you up to 25 GB space for each user account, no ads, blackberry and Microsoft outlook interoperability, virus and spam protection by Postini, and Full administrative and data control.

References

Google Support
Bluehost Tutorials
Google Docs document courtesy of  Kevin . H . Brown.