More than likely, they created slider controls, and then defined areas that will accept touch to activate them. Then they bound the character to that slider.
Take a look at the following demo:
Each slider has a defined area, which is a darker shade of blue around the slider control. If you click inside of this area, it activates the slider. As you move your cursor around, it will calculate the distance you have moved from your original click.
I was going to post the code here, but quite frankly you would just be better off with the unity project itself, as I wrote it pretty quickly, and posting the code would require a great deal of effort in my part, as to explain all the parts.
So instead, just download the Unity Project. If it helps you great, if it doesn't, whatever.