With a manufacturer simultaneously producing both ordinary products and green innovative products taken into consideration, firstly, an analysis is made of the trade-in strategy choice of the manufacturer based on optimization theory; secondly, a game model is constructed between the government and manufacturers for an inquiry into the influence of governmental differentiated trade-in subsidies on manufacturers, consumers, and the environment. Research results show that in the absence of government subsidies, the optimal trade-in strategy for manufacturers is to simultaneously provide the same trade in rebate for both products. For manufacturers, differentiated trade-in subsidies bring differentiated trade-in rebates, thus increasing the demand for green innovative products and improving manufacturer profits, but reducing the demand for ordinary products. For consumers, differentiated trade-in subsidies reduce the net payment price of old consumers and increase their willingness to trade-in. However, when there is a high environmental preference and durability of old products on the part of the government, subsidies will always reduce the surplus of old consumers. For the environment, when there is a low degree of greenness of innovative products and the residual value of old products, subsidies or not may not be able to positively improve the environment.