Multi-regional and multilingual sites
A multilingual website is any website that offers content in more than
one language. Examples of multilingual websites might include a
Canadian business with an English and a French version of its site, or
a blog on Latin American soccer available in both Spanish and
Portuguese.
A multi-regional website is one that explicitly targets users in
different countries. Some sites are both multi-regional and
multilingual (for example, a site might have different versions for
the USA and for Canada, and both French and English versions of the
Canadian content).
Expanding a website to cover multiple countries and/or languages can
be challenging. Because you have multiple versions of your site, any
issues will be multiplied, so make sure you test your original site as
thoroughly as possible and make sure you have the appropriate
infrastructure to handle these sites. Following are some guidelines
and best practices for creating multilingual and/or multi-regional
sites...
You can read the full documentation on Google for best practices here.
I suggest you do indeed create a secondary site/domain name (ie. example.it) to avoid mistranslations, avoiding errors and I think your results will be better targeting the Italian users directly and in turn your Italian site will get better ranking, targeting Italian visitors opposed to a hidden translation. In the end, you will be required to translate all pages regardless of method and this way it will keep you from having a partially translated site opposed to a new site that is all done in Italian from the get go.
.it
domain name. It doesn't have to be translated and served on the existing domain. – Stephen Ostermiller♦ Oct 19 '16 at 19:46