Friedrich Nietzsche is a name that people might recognize (maybe) but, over the population level, is not particularly widely known. Let alone not knowing the name of the philosopher, the phrase 'God is Dead' is almost certain to have been construed is literal, whereas its never been meant to be so.
In writing "Beyond Good and Evil", Nietzsche writes "God is dead, and we have killed him!", in his usual biting and allegorical style. If taken in the context of Nietzsche's full work, one can see that Nietzsche is not saying that tradition notions of God are gone, but as he attacks the endeavor of philosophy to find unifying reasons behind disjointed events, Nietzsche is claiming that the philosopher's god of unity is dead, and it is the very rational process of logic and science which leads to the conceptual death of reason.
Friedrich Nietzsche did not literally mean God is dead - in fact, he did not believe God existed to begin with. It was the argument, quite reasonably, that our society no longer lives by the standards in which a God exists, and that man has developed his own morality and ethics relative to the non-existence of a God, whether he does exist or not.
“God is dead. God remains dead. And we have killed him. How shall we comfort ourselves, the murderers of all murderers? What was holiest and mightiest of all that the world has yet owned has bled to death under our knives: who will wipe this blood off us? What water is there for us to clean ourselves? What festivals of atonement, what sacred games shall we have to invent? Is not the greatness of this deed too great for us? Must we ourselves not become gods simply to appear worthy of it?” -- Nietzsche
The quote refers to the secularization of the world with the lack of a higher moral compass, which in turn could end up ruining the world due to the lack of morals and ethics.
The idea of a devout anything is mostly lost. The general populace of the world ignores their religion, its rules, or its virtue on a daily, and sometimes hourly basis. With those religions that do allow for forgiveness, the amount of "sins" conducted each day are not only inummerable, but often forgot about by the time forgiveness should be asked for. The Muslim's tried to address this by praying 5 times a day. How many Muslim's actually do this? Just because you are the largest religion in the world does not mean you will be the most righteous. Nietzsche was right to say God is dead. The general public no longer believes he really exists or really will damn them for wearing clothing made of two types of thread.