Basically the first person will describe something and the second person will give a character fitting those qualities.

Example: 1: Give me a character that uses a sword and has black hair
2: How about Kirito from Sword Art Online. Give me a character with pigtails.
and then the 3rd person post a picture of a character with pigtails and then they ask for something and so on and so forth.

Have Fun!

Give me a character who usually wears a hat!