This not an intuitive tool. Defining a smaller area on the map as what you want does not make sense. Rather think of it as a "relative" area. The smaller the area the more you zoom out. We prefer to use the PanTool.
Note: When you release, the map will zoom to the area approximating you desired area. This depends on the shape of the map window and the shape you defined.
Our Preference - Use the PanTool. If you have a mouse with a scrolling wheel, it is much faster to position the cursor at the desired center of the map and scroll until you have the extent you want. It is also our preferred tool to zoom in.